Author | Li Baitian
Source | PEdaily of the investment community
In this special spring, Tencent is still quietly sweeping the goods.
It is reported that according to documents submitted by Tencent and Pinduoduo to the US Securities and Exchange Commission (SEC), Tencent has just sold 50 million US dollars to continue to increase his stake in Pinduoduo and, together with Pinduoduo's other long-term investors, will definitely buy 1.1 billion US dollars worth of new shares.
So farTencent holds a total of 29.2% of Pinduoduo's shares, still the second largest shareholder.However, the current lucky "unprecedented" fraud incident cast a shadow on Chinese stocks, and people began to worry about the situation of Pinduoduo.
Coincidentally, Tencent has just officially taken control of HUYA Inc.. On the evening of April 3, HUYA Inc. announced that Tencent had become its largest shareholder, raising its voting rights to 50.1%. Not surprisingly, Tencent's integration of DouYu International Holdings Limited and HUYA Inc., another holding platform, is coming. Last year, Tencent set up a live broadcast department, the main task of which is to coordinate the resources of DouYu International Holdings Limited, HUYA Inc. and penguin e-sports.
Just a few days, two large-scale US stocks are surprising, but this is only the "tip of the iceberg" of the recent achievements of Tencent's investment chariot.Under the epidemic, while many VC/PE institutions cherish the slow pace of bullets in their hands, Tencent's investment is the same as Sequoia Capital's China Fund.
Tencent invests the latest big money:
50 million US dollars, quietly increasing the holdings of Pinduoduo
Increasing their holdings of Pinduoduo and Tencent continue to show unlimited interest in e-commerce.
According to filings filed with the Securities and Exchange Commission (SEC) by Tencent and Pinduoduo on April 3, Tencent subscribed for 6.15574 million Class A common shares (a total of 1.538935 million ADS) of Pinduoduo for a total price of about $50 million on March 31. At this price, Tencent subscribed for shares in Pinduo at about $32.49 / ADS, while Pinduoduo's share price is currently $36.28 / ADS.
Also on March 31, Pinduoduo announced that some long-term investors had purchased new shares in the company through private placement, with a total value of US $1.1 billion, accounting for about 2.8% of the total number of shares issued. The transaction is expected to be completed in early April 2020.
It is reported that this round of fund-raising is mainly used to promote the uplink of China's agricultural products, continue to consolidate the comprehensive capacity of the first major platform for the uplink of agricultural products, promote strong convection in urban and rural economies, and promote the transformation and upgrading of foreign trade enterprises, as well as China's C2M industrial belt to carry out "new infrastructure" infrastructure transformation. In 2020, the company will continue to expand the scope and intensity of "10 billion subsidies" in the field of new consumption.
Tencent has a deep relationship with Puduo. Since the beginning of Pinduoduo's B round of financing in 2016, Tencent has participated in every round before Pinduoduo's listing. When Pinduoduo went public that year, Tencent accounted for 17% of the shares, making him the second largest shareholder. Up to now, Tencent holds about 790 million shares of Pinduoduo, accounting for 29.2%, and is still the second largest shareholder.
as everyone knows,Pinduoduo is one of Tencent's weapons against BABA on the e-commerce track.Tencent's e-commerce layout is gradually carried out through investment, JD.com, Vipshop Holdings Limited, Pinduoduo, Mogu Inc and so on, of which JD.com is the biggest chess. By the end of the first quarter of 2020, Liu Qiangdong held 15.4 per cent of JD.com, still JD.com 's second largest shareholder, while JD.com 's largest shareholder was Tencent, with 17.8 per cent.
Despite the help of Tencent's strong traffic logic, the development of these e-commerce platforms varies. At present, JD.com and Pinduoduo are both entrusted with important tasks: high-end and B2C, using JD.com against Tmall, low-end and C2C, and Pinduoduo against Taobao and Taobao special versions, in order to complement each other.
Why did Tencent raise the bet at this time?
After Lucky, people began to worry about Pinduoduo.
At present, lucky because of fraud deep in the whirlpool, this fire also began to burn to Chinese stocks, and also listed at an incredible speed of Pinduoduo naturally bear the brunt.
Back in 2018, when Pinduoduo, under the age of 3, rang the bell on Nasdaq, the controversy over the company reached its climax.
Like Lucky, the growth of Panduo has always been accompanied by controversy. Many people analyze the business model and want to find out why it took only two years to make GMV break through the 100 billion mark, because by comparison, it took 15 years for JD.com and 5 years for Taobao; more people held up the bad flag and could not accept a company that once openly moved fake goods to the table, so they entered the capital market.
Even after IPO, the controversial discussion on Pinduoduo's model has not stopped, Pinduoduo is also desperately trying to save the market image. In September last year, Pinduoduo revamped her mobile phone APP and launched nearly 500 well-known brands to create the impression of quality rather than low price.
Last month, Pinduoduo, who has been on the market for nearly two years, handed over his 2019 Q4 and full-year results. According to the financial report, Pinduoduo had a net cash of 34.9 billion yuan as of December 31, 2019. By the end of 2019, the number of annual active buyers of Pinduoduo platform had reached 585.2 million, a net increase of 48.9 million in a single quarter, and a net increase of 167 million over the same period last year.
What does it mean behind these numbers? The number of active buyers in 585.2 million was a net increase of 209 million compared with 272.6 million in the same period a year ago; horizontally, the figure for BABA and JD.com for the same period was 711 million and 362 million respectively.
Maybe it can be understood like this:The ten billion yuan subsidy policy launched by Pinduoduo in the second half of 2019 is beginning to bear fruit.However, this kind of customer acquisition is not sustainable and requires a lot of cash. A few days ago, Pinduoduo announced that in 2020, the company will continue to expand the scope and intensity of "10 billion subsidies" in the field of new consumption. Although Pinduoduo still has 33.3 billion of cash and cash equivalents on his books,The blood transfusion of Tencent and long-term investors has become particularly important.
When it comes to the way of losing money and subsidizing money, Pinduoduo is no less than Lucky. The impact of Rui Lucky's thunderstorm continues to expand, and the entire US stock market, especially Pinduoduo, NIO Inc. and other companies that are still losing money and burning money in the US stock market, have to face more severe and profound scrutiny.
Tencent's investment sweeps the goods:
At least seven investment cases have been made public in the last two weeks.
Pinduoduo is not Tencent's latest investment case. In the past two weeks, Tencent began to sweep the goods one after another.
On the evening of April 3, HUYA Inc. announced that Tencent formally sent a letter of notice to HUYA Inc. and JOYY Inc Group, saying that he had exercised his shares to buy 16523819 HUYA Inc. Class B common shares at a total purchase price of about US $262.6 million in cash. After the deal was completed, Tencent became HUYA Inc. 's largest shareholder, raising his voting rights to 50.1 per cent.
At this point, Tencent officially controlled HUYA Inc. and became the major owner of DouYu International Holdings Limited and HUYA Inc., the two major live broadcast platforms. In DouYu International Holdings Limited, Tencent holds 37.2% of the shares and is DouYu International Holdings Limited's largest shareholder.
Based on this, outsiders have speculated that the outcome of the merger of DouYu International Holdings Limited and HUYA Inc. is finally coming. As early as 2015, Tencent tried to promote the merger of DouYu International Holdings Limited and Dragonball Live, which he invested in, but Tencent's integration of e-sports 's resources never stopped. In March 2019, Tencent set up a live broadcast department internally, whose main task is to coordinate the resources of DouYu International Holdings Limited, HUYA Inc. and e-sports Penguin.
Except for what you do best.In social networking and gaming, Tencent's recent intensive investment has also expanded to the financial and intelligent manufacturing industries.According to Tianyan, on April 3, Shenzhen Tencent Industrial Chuangwin Co., Ltd. added a piece of foreign investment information to Shenzhen Huazhi Intelligent Manufacturing Technology Co., Ltd., with a capital contribution of 75000 yuan and a shareholding of 0.25%.
Prior to this, on March 26 and 27, Shenzhen Tencent Industrial Chuangwin Co., Ltd. successively invested in three financial technology companies, namely Yingchuang Allen, Mushroom Wealth and Today Investment, with a shareholding of less than 1%. On March 19, it also invested in Yu Pan Intelligence, a provider of intelligent vision solutions for the Internet of things, which mainly focuses on the long tail market in the field of pan-security.
Prior to this, Tencent, together with Temasek, led big data and Minglue Technology, a service provider in the field of artificial intelligence, and Kuaishou Technology also participated in the investment.
And in the undercurrent surging online music platform market, Tencent's investment in Universal Music has finally come to an end. Tencent announced on March 31st that the consortium led by him had completed the acquisition of a 10 per cent stake in Universal Music (UMG), with a transaction value of 3 billion euros.
Potential buyers of Universal Music have been giants such as KKR, BABA, Apple Inc, Amazon.Com Inc, and Verizon Communications Inc, an American telecom operator. In the nearly two-year deal, Tencent finally emerged from many competitors, heating up the battle for China's online music platform again. Earlier, BABA announced a partnership with Taihe Music Group. BABA had previously invested heavily in NetEase, Inc Yun Music. On the same day that Tencent announced his investment in Universal Music, NetEase, Inc Yun Music announced that it was holding hands with Rolling Stones.
The above is just the "tip of the iceberg" recently made by Tencent Investment. Tencent established the Investment and M & A Department (Tencent Investment) in 2008, which has long focused on investment mergers and acquisitions in consumer Internet and industrial Internet-related areas around the world. In early 2020, Liu Chiping released the latest transcript of Tencent's investment: as of January 2020.Tencent has a total of more than 800 investment companies, of which more than 70 have been listed and more than 160 have become unicorns with a market capitalization or valuation of more than $1 billion.
In the past 10 years, Tencent has invested in more than 700 companies. Now, under all kinds of uncertainty in the market, Tencent has not stopped investing, even at a faster pace, no less than any of China's top VC/PE institutions.