Tencent acquires 19.77% stake in Caixin Media

21 July 2012 11 h 58 min Comments Off

As announced 2 days ago, Tencent, China’s largest Internet company by market value, has acquired an undisclosed stake in Caixin Media, one of the country’s leading financial news providers.

Caixin Media, established in December 2009, was headed by veteran editor-in-chief Hu Shuli. The Zhejiang Press Group paid 40 million yuan ($6.35 million) for a 40-percent stake, with four other shareholders holding the rest.

The Zhejiang Press Group, the company’s largest shareholder, will keep its 40-percent stake following the introduction of Tencent as one of the company’s shareholders, Caixin said on its official microblog.

Mainland media said Tencent would pay 56.48 million yuan ($8.9 million) for the 19.77 percent stake in Caixin, but Tencent in Hong Kong declined to comment on the size of the stake or the price.

“The purchase of a stake in Caixin is a strategic investment. The two sides will work to make financial news reach a broader audience,” said Ye Guozhen, Tencent’s investor relations manager.

“The investment in Caixin, made “recently”, may lead to cooperation in content”, Catherine Chan, a spokeswoman for Tencent, said. She declined to provide financial details.

Tencent said it will not be involved in Caixin’s daily operations and Caixin will remain independent in terms of news reporting. The two companies are expected to launch cooperative new media projects.

In recent years, Tencent has been diversifying and expanding its services for online users. Tencent expanded in businesses including e-commerce and advertising to diversify from online games, which account for more than half of its revenue.

. Last year, the company spent 450 million yuan on a 4.6-percent stake in Huayi Brothers Media Corp, a leading film producer.

. In June 2012, Tencent bought a minority stake of Epic Games, a US 3D game studio

. In March 2012, Tencent bought a US game community, ZAM

. In October 2011, Tencent  helped ChinaVision Media Group Ltd., a Hong Kong-based producer of films and television programs, to acquire a movie and television content producer, China Entertainment Media Group Ltd

. In July 2011, Tencent puts HK$892 million for a 15.68 % strategic investment in Kingsoft

Tencent’s revenues surged 52.2 percent from one year earlier to reach 9.65 billion yuan in the first quarter of 2012, with net profits rising to 2.95 billion yuan, up 2.8 percent year-on-year.

Sources: China Daily, reuters.com (20/07/12)

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