Tencent plans to buy a 5 per cent stake in China’s Yonghui Superstores in the latest tie-up between Chinese technology companies and bricks-and-mortar retailers.
Yonghui, which operates around 500 stores, said in a filing to the Shanghai stock exchange that the share transfer agreement would be made with Linzhi Tencent, a Tencent affiliate. Tencent will also take a 15 per cent stake in Yonghui supply chain and logistics subsidiary Yonghui Yunchuang Technology following further discussions.
The move follows similar investments in brick-and-mortar businesses by rival Alibaba and further aligns Tencent with Chinese online retailer JD.com, which is already an investor in Yonghui.
Trading in Yonghui shares was suspended from Tuesday and the company over the matter and said it will provide an update on December 18. Its stock jumped to its daily limit on Friday on reports of the deal. Hong Kong-listed shares in Tencent were down 1.5 per cent as the benchmark Hang Seng index shed 0.5 per cent on Tuesday.
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