{{ currentBoardShortName }}
  • Markets
  • Indices
  • FX
  • Energy
  • Metals
  • Live
Markets
As of: {{timeStamp.date}}
{{timeStamp.time}}

Markets

{{ currentBoardShortName }}
  • Markets
  • Indices
  • FX
  • Energy
  • Metals
  • Live
{{data.symbol | reutersRICLabelFormat:group.RICS}}
 
{{data.netChng | number: 4 }}
{{data.netChng | number: 2 }}
{{data | displayCurrencySymbol}} {{data.price | number: 4 }}
{{data.price | number: 2 }}
{{data.symbol | reutersRICLabelFormat:group.RICS}}
 
{{data.netChng | number: 4 }}
{{data.netChng | number: 2 }}
{{data | displayCurrencySymbol}} {{data.price | number: 4 }}
{{data.price | number: 2 }}

Latest Videos

{{ currentStream.Name }}

Related Video

Continuous Play:
ON OFF

The information you requested is not available at this time, please check back again soon.

Nov 8, 2017

China's Tencent buys 12% stake in Snap

The front of the New York Stock Exchange (NYSE) with a Snap Inc. logo hung on the front of it stands shortly before the company's IPO in New York

Security Not Found

The stock symbol {{StockChart.Ric}} does not exist

See Full Stock Page »

Snap Inc (SNAP.N) said on Wednesday that Chinese tech and media investment firm Tencent Holdings Ltd had taken a 12 per cent stake in the company, a day after the owner of disappearing-messaging app Snapchat was punished by Wall Street for disappointing quarterly results.

Snap's shares fell 16 per cent to US$12.67, well below their US$17 initial public offering price in March, as investors fretted about Snap's slowing user growth in the latest quarter and viewed Tencent's move as an investment rather than the precursor to a merger.

"(Tencent) buys all sorts of minority investments, and I don't think we can extrapolate that this means they intend to take over the company," said Wedbush Securities analyst Michael Pachter.

Snap said it had only received the details of the stake from Tencent this month. Tencent's 145.8 million class A common shares of Snap, worth about US$1.7 billion at Wednesday's price, give the Chinese company no voting rights.

Tencent president Martin Lau told Snap his firm is "excited" to deepen its relationship with the firm, Snap said in a regulatory filing. A Snap spokesman declined to comment further.

The Chinese tech company, which owns mobile chat service WeChat, has bought stakes in several companies over the past few years, including electric car maker Tesla Inc and ride services company Lyft Inc. In 2013 it invested in Snap through an affiliate.

Investments in the United States by Chinese tech heavyweights have become common, and the two countries unveiled US$9 billion in new deals on the arrival of U.S. President Donald Trump in Beijing on Wednesday.

Apart from Tencent, Alibaba Group Holding Ltd and Baidu Inc have poured cash from a decade of growth in China into buying stakes in U.S. firms.

Snap's ownership structure, which reserves 95 per cent of voting rights for its co-founders, made it likely Tencent was just accumulating a financial stake, analysts said.

While the stake could lead to a business partnership with Tencent and help Snap expand its reach into China, Morningstar analyst Ali Mogharabi said Snap's problems remained, chiefly slowing user growth and competition from Facebook Inc's Instagram.

ROLE MODEL

Snap co-founder and Chief Executive Evan Spiegel, who has in the past referred to Tencent as a role model, said on Tuesday that he was looking to redesign Snapchat to reach a broader audience.

Snap's daily active users (DAU) stood at 178 million in the third quarter, below expectations of 181.8 million, according to research firm FactSet.

The company has disappointed investors each quarter since it floated on the New York Stock Exchange in March. Snap has fallen by more than a half since its high of US$29.44 on March 3, a day after it went public.

Unlike many U.S. stock market-listed corporations, Snap is not obligated to disclose changes in Tencent's ownership of Snap's class A stock.