Tencent buys 15.68% of Kingsoft

Strategic investment to deepen collaboration of two companies in online security and other areas.

Kingsoft Corporation Limited, a leading software developer in China, together with Tencent Holdings Limited, one of the largest providers of Internet, mobile and telecommunication value-added services in China, on Wednesday announced that the two companies have entered into strategic partnerships. Tencent will hold 15.68% shareholding in Kingsoft Corporation Limited through acquiring shares from Kingsoft’s existing shareholders; and will make a strategic investment in Kingsoft Internet Security Software, an Internet Security services provider under Kingsoft Corporation Limited, in the meantime. 

Through the establishment of long-term strategic partnerships, the two companies will join hands to provide trustworthy Internet security solutions for the users; and will explore further collaboration in Internet application software and online game markets, according to a Tencent report.

Under the share purchase agreements, Mr. Pak Kwan Kau, founder and executive director, and Mr. Cheung Shuen Lung, non-executive director of Kingsoft Corporation Limited, will transfer a total of 15.68% of their shares in Kingsoft Corporation Limited to Tencent. The total consideration amounts to HK$892 million. Meanwhile, Tencent also supports Kingsoft Internet Security Software, an Internet Security services provider under Kingsoft Corporation Limited, through a strategic investment. The investment amount was not disclosed.