WeChat Parent Tencent Buys 10% of Snapchat
Tencent and Alibaba are two significant Chinese investors behind Snap. Getty Images
Tencent, the Chinese Internet giant which owns messaging app WeChat, just recently acquired about 10 percent of Snap Inc.’s shares in free market, CNBC reported.In a filing with the Securities and Exchange Commission today, Snap said Tencent got 145,778,246 shares of Snap’s non-voting Class A common stock in the last quarter.The dollar amount of the deal is concealed, however based on Snap’s share price for the duration, Tencent could have paid at least $2 billion. Tencent’s 2016 profits was $22 billion. The Wall Street Journal price quotes the stake at 12 percent.Tencent first purchased Snap in 2013, when Snap raised$ 80 million in a series B financing round from Tencent and five endeavor
capital companies, Crunchbase records show. The business was valued at $800 million at the time. Snap went public in March and raised$3.4 billion at the initial public offering, pressing they business’s market appraisal to $24 billion.Another major Chinese investor behind Snap is Alibaba, which took part in a$ 200 million financing round in March 2015, along with Saudi billionaire Prince Alwaleed Bin Talal(recently imprisoned in a royal feud ). Paradoxically, as Snapchat and WeChat operate in quite comparable businesses, Snap calls Tencent among its significant rivals in today’s quarterly filing. Unless the 2 companies have some sort of collaboration program in sight, Tencent
might be growing its own company at the cost of its investment.Going public hasn’t equated to accelerated growth for Snap up until now. For 3 quarters straight, Snap missed revenue projections as it cannot grow Snapchat’s user base, which directly ties to marketing revenue.Yesterday, Snap published a $443 million net loss in the quarter ending September 30
, failing Wall Street’s currently decreased estimate. Stock cost slide by nearly 20 percent following the earnings release.< img itemprop=image src =https://nyoobserver.files.wordpress.com/2017/11/gettyimages-647104884.jpg?quality=80 alt="
This Chinese Snapchat Competitor Simply Bought 145 Million Snap Shares” >
