Tencent Cuts Kuaishou Stake by a Third in $1.6 Billion Block Trade

Tencent has dramatically reduced its stake in Kuaishou, selling roughly 273 million Class B shares through an off-market block trade on Monday. The deal drops Tencent’s ownership from 15.68% to 9.37%, stripping it of its status as a major shareholder in China’s second-largest short-video platform.

The sale was executed after trading hours on July 6 through Tencent Mobility, a wholly owned subsidiary. Shares were priced between HK$43.15 and HK$44.53 apiece, which could net Tencent up to $1.6 billion depending on the final allocation. All buyers were independent third parties with no ties to Kuaishou or its affiliates, according to the company’s filing to the Hong Kong Stock Exchange.

Despite the selloff, Tencent said it still has confidence in Kuaishou’s long-term prospects and expects the strategic partnership between the two companies to continue. Kuaishou’s board echoed that sentiment, stating the transaction “will not have a material adverse impact” on daily operations.

The stake reduction comes at an interesting time for Kuaishou, which has been aggressively buying back its own stock. The company has a standing HK$16 billion (about $2.05 billion) share repurchase program announced in May 2024. So far, it has spent HK$8.35 billion to buy back 174.8 million Class B shares. Kuaishou said it would continue executing the remaining buyback capacity in phases, with the goal of delivering long-term value to shareholders.

The sale ranks among the biggest public-market exits Tencent has made in years. The company has been quietly trimming its portfolio, balancing its dual role as operator and investor across China’s tech landscape. For Kuaishou, the lighter Tencent overhang, paired with an active buyback program, suggests management sees the stock as undervalued.