Rumours surface of China Mobile, Tencent talks - TechCentral

Rumours surface of China Mobile, Tencent talks

Tencent's QQ mascot

Tencent's QQ mascot

Is Hong Kong-based Internet company Tencent, in which JSE-listed media group Naspers has a 35% stake, for sale?

A number of Chinese websites are reporting that the world’s biggest mobile phone operator by subscribers, China Mobile, is in talks to buy Tencent, which owns the popular QQ online chat service.

The rumours started when Chinese Internet portal published a speculative piece, quoting unnamed sources, in which it suggested that China Mobile executives, including its president, Wang Jianzhou, had visited Tencent headquarters and had discussed the possibility of an acquisition.

However, China Mobile has denied that there are any talks taking place, telling The Wall Street Journal in a statement that recent media reports are “groundless”.

China Mobile, which has its own, less successful, instant messaging service, is believed to be keen to become a significant player in the mobile content and application market.

Tencent’s QQ is the leading instant messaging service in China with 485m active users and peak simultaneous users of about 75m, according to data included with Naspers’s interim financial results for the six months to September 2009.

In addition to instant messaging, Tencent offers users the ability to play online games and access online forms of electronic entertainment. It makes most of its money from micropayments by its users.

Tencent, which is listed in Hong Kong, contributed R2,2bn to Naspers group turnover in the six months to September; it added R1,1bn to the group’s earnings before interest, tax, depreciation and amortisation.

Naspers has acquired a number of instant-messaging and Internet communications companies in recent years. It owns stakes in Gadu-Gadu in Poland, Nimbuzz, based in The Netherlands, and MXit, in SA, among others.

Rumours surfaced late last year that Naspers was interested in buying the ICQ chat service from America Online. US technology website TechCrunch reported that ICQ could fetch as much as US$300m for AOL. However, those rumours have since died down.  — Duncan McLeod, TechCentral

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