Tencent bolsters overseas presence in smart retail with investment in Australian payments firm Afterpay

Tencent Holdings has become a “substantial shareholder” in shop-now-pay-later firm Afterpay, the Australian company said in a statement, as the Chinese internet giant continues to expand its overseas investments in smart retail and fintech services.

Shenzhen-based Tencent purchased a 5 per cent stake in Australia-listed Afterpay, the company disclosed in a filing to the Australian Securities Exchange on Friday. Afterpay, which allows consumers to shop online or in store and pay later by splitting the purchase into four instalments, has more than 4.3 million active users and works with 30,600 merchants.

Afterpay’s shares opened 30 per cent higher on Monday.

“To be able to tap into Tencent’s vast experience and network is valuable, as is the potential to collaborate in areas such as technology, geographic expansion and future payment options on the Afterpay platform,” Afterpay co-founders Anthony Eisen and Nick Molnar said in the statement.

Tencent’s Afterpay deal comes amid the Chinese company’s ambition to step up overseas investments and expand into new market segments such as smart retail. There are currently more than 800 companies in Tencent’s investment portfolio. More than 70 are publicly listed while a further 160 are unicorns – privately held start-ups with a market value of US$1 billion or more.

“More communications and cooperation with overseas entrepreneurs” will be pursued to expand the Shenzhen-based firm’s global footprint, Tencent president Martin Lau Chi-ping said at the company’s investment conference in January. “In the future, we will pay more attention to smart retail and payment platforms with the development of Tencent’s WeChat mini-app ecosystem.”