China’s Tencent to give $16.4 billion stake to shareholders as dividend

by   |  VIEW 1089

China’s Tencent to give $16.4 billion stake to shareholders as dividend

Tencent Holdings Ltd., the 24-year-old Chinese multinational technology conglomerate mostly focused on gaming, social media and e-commerce businesses, had issued a statement on Thursday saying that the Shenzhen-based wide-ranging internet-related service provider would disburse a lion’s share of its stake, worth about $16.37 billion or HK$127.69 billion, to its stakeholders as dividend payout, though the move would downgrade Tencent’s stance as a leading stakeholder in

On top of that, in a statement released shortly after the announcement on Thursday’s early-morning Asia-Pacific trading hour, Tencent was quoted saying that this might be a right time to hand out its stake considering the e-commerce platform’s booming growth over recent months which in effect should enable it to self-finance further expansions alongside operations.

More importantly, latest intransigent move from Tencent to divest most of its stakes as dividend came forth as the President and Executive Director of Tencent, Martin Lau, has been set to depart as a director late in the day.

In tandem, a Tencent act to distribute a majority of its stakes in as a dividend pay-off, in effect would lower its stake to a 2.3 per cent from a prior 17 per cent. Meanwhile, adding that Tencent would continue to maintain its strategic relationship with, the Chinese gaming and social media giant said in a statement, “The company and will continue to maintain their mutually beneficial business relationship, including via their ongoing strategic partnership agreement”.

China’s Tencent to disburse stakes as dividend

Apart from that, had told in a separate statement that it would continue to work on a strategic partnership agreement with Tencent. Nevertheless, breaking off the latest Tencent deal further, eligible Tencent stakeholders would receive a share in for each 0.21 share they were holding in Tencent, while Tencent would disburse a total of 457.3 million common shares.

Nonetheless, followed by the announcement, shares opened up Hang Seng 6.4 per cent lower, while Tencent gained 2.5 per cent.