INTERNATIONAL_ Tencent’s decline in the Sea Group could mark a significant change in business cooperation between the two parties.
Sea Group has announced that it plans to increase CEO Forrest Li’s voting power to 57% from the current 54%. At the same time, it will reduce the voting rights of Tencent investors to less than 10%.
Sea Group also confirmed the decision will be made during the Annual General Meeting on February 14, where shareholders are expected to vote on this in a transparent and fair manner.
Li’s voting power in the company will increase as each Class B common share will have voting rights increased from three votes to 15 votes. At the same time, Tencent will convert all of its Class B common shares into Class A common shares, for which it has sent “irrevocable notice” to Sea Group.
Upon completion of the conversion, Li will own all of Sea Group’s Class B common shares. The Board of Directors believes that, as Sea has significantly expanded to become a leading global consumer internet company, it is in the company’s best interest to pursue long-term growth strategies to clarify its capital structure through the proposed changes mentioned above. This was said by the Singapore-headquartered company in a statement.
Last month, Sea’s e-commerce arm Shopee faced calls for sanctions from the Indian commerce body for allegedly being “of Chinese origin” and claiming that the e-commerce platform This is run by Tencent. This comes just a few months after Shopee was launched in the country.
In the past, the Indian government has banned some Chinese apps, and it has also taken a tough stance against companies heavily backed by mainland investors. Perhaps this is what prompted the action of the aforementioned Sea Group.