Hong Kong shares in Tencent Holdings (HKEX: 00700; OTC: TCEHY) dropped 2% Thursday after its largest shareholder trimmed its stake in the company.
Amsterdam's Prosus N.V. (OTC: PROSY), which operates e-commerce and internet platforms, trimmed its stake in Tencent by 2% for HK$114.2 billion ($14.7 billion), according to a filing with the Stock Exchange of Hong Kong.
According to data from Refinitiv, the deal is the largest block trade of all time.
Despite the small equity sale, Prosus' bet on Tencent in 2001 has been a major success. Originally, Prosus obtained a 47% stake in Tencent for $32 million; now its remaining equity control of 29% is worth a whopping $221 billion.
Prosus, which remains Tencent's top shareholder, said it wouldn’t sell any additional shares of the Chinese gaming giant for at least another three years.
"Prosus intends to use the proceeds of the sale to increase its financial flexibility to invest in growth, plus for general corporate purposes," Prosus said in a statement.
Today’s stock plunge in Tencent comes during a fierce antitrust crackdown by Beijing. Last month, China’s market regulator slapped Tencent with a 500,000 yuan ($77,000) fine. The antitrust crackdown has also caused complications in Tencent’s plan to merge China’s top game live streaming platforms Huya (NYSE: HUYA) and DouYu (Nasdaq: DOYU) and create a $10 billion entity. Regulators fear the merger would give Tencent “overwhelming dominance.”
Since Feb. 10, Tencent’s Hong Kong shares have lost 19% of their value.
Intraday in the U.S., Tencent was trading 2% higher, at $80.19 per share.