Technology investor Prosus NV has opted to sell off its huge stake in China’s tech and entertainment giant Tencent.
Prosus will use proceeds from the sale to fund a stock buyback in itself and parent Naspers.
The Dutch firm’s decision knocked down shares in the Chinese tech giant, Tencent.
The move is aimed at closing a gap between the market value of Prosus/Naspers and that of the 28.9% stake in Tencent they own, which is currently worth about $136 billion.
Prosus itself is currently worth less than that stake at some 109.8 billion euros ($116.2 billion).
Prosus shares, which are down 27% in the year to date, jumped 10% on the news to 58.36 euros in Amsterdam.
Shares in Naspers in Johannesburg were up 13% while shares in Tencent were down 1.5% in Hong Kong.
The share sale plan came as a surprise as Prosus had agreed not to sell further Tencent shares after selling a 2% stake worth $15 billion in 2021.
Tencent said it supports the move and expects the impact of the share sale to be “limited”.
Separately, Prosus said it had sold a $3.67 billion stake in JD.com.
The current discount of Prosus to the value of assets it owns is 54% and at Naspers 65%, according to company-provided figures.
Prosus is in talks to sell its stake in Russia’s Avito, which had been valued at $6 billion before the Ukraine war.