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Tencent To Sell $16B Stake In

Tencent To Sell $16B Stake In

Tencent To Sell $16B Stake In

Tencent is reducing its stake in, the second-largest eCommerce company, as it seeks to adjust to Beijing’s crackdown on various tech companies’ growing influence.

The company will divest 457 million shares worth $16 billion by making a one-time dividend payment to its shareholders. The shares represent 86.4% of the company’s stake in

The distribution will drop Tencent’s stake to 2.3%, effectively marking an end to its position as the largest shareholder in the company. Instead,’s founder, Richard Liu Qiangdong, will become the biggest stakeholder with his 13.9% stake in the company, followed by Walmart at 9.3%.

Tencent noted in a filing on Thursday that it had decided to divest its share in because the company had reached a position where it can finance its own growth. Under the terms of the deal, Tencent’s President Martin Lau will step down as the director of

The effort will reduce Tencent’s dominance in the market and “is potentially an attempt to shift towards fairer competition, as well as to be more in line with the agenda for China authorities,” said Yeap Jun Rong, market strategist for IG said.

Following the announcement, Tencent’s stock surged by more than 4% in Hong Kong, while saw its stock tumble by 7%.

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