Tencent invests US$66 million in leap from smartphone screen to the big screen

Operator of China’s largest social network will become the second-biggest shareholder of a TCL-backed smart TV maker.

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TCL Multimedia Technology and Tencent Digital have entered into strategic cooperation involving smart TVs. Photo: AFP

Published: 2:00pm, 3 Jul 2017Updated: 11:00pm, 3 Jul 2017

Tencent Digital, a unit of the Hong Kong-listed Tencent, has agreed to invest 450 million yuan (US$ 66.3 million) in Shenzhen Thunderbird Network Technology, a smart television company backed by TCL Multimedia Technology Holdings.

The capital injection will make Tencent Digital the second-largest shareholder of Thunderbird Network Technology with a 16.67 per cent stake in the smart TV maker, according to a stock exchange filing by TCL Multimedia on Monday.

TCL Multimedia, which indirectly owns Thunderbird Network Technology, will see its stake in the company reduced from 54.05 per cent to 45.55 per cent after the deal.

The capital injection is part of the strategic cooperation deal inked between Tencent Digital and TCL Multimedia. Apart from the funding support for the development of the smart TV business, the two companies are expected to set up a joint operation team to “increase business operation value through big television screens for family entertainment, and deepen the cooperation in product upgrade and innovation, market resource synergies and membership coherence”, said the statement.

Zhang Bing, principal analyst at IHS Markit, said the investment is expected to help Tencent extend its business reach beyond smartphone users.