The deal is the biggest block trade ever, according to data provider Refinitiv. Block trades are typically arranged directly between big institutional investors rather than on public stock exchanges.
Tencent’s stock dropped 1.5% on Thursday in Hong Kong after the news. It has gained about 80% since Prosus was listed on the Amsterdam stock exchange in 2019.
After completion of the deal, Prosus will remain Tencent’s single largest shareholder, with 28.9%. But it will lose its controlling shareholder status, which under Hong Kong listing rules is granted to investors who hold at least 30% of voting rights.
“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.
It also promised not to sell any further Tencent shares for at least the next three years.
“The focus now is on growing the business and improving financial flexibility and giving ourselves the room to be able to deploy across multiple capital allocation opportunities,” Basil Sgourdos, financial director and executive director of Naspers, said in an earnings call in November.