Chinese tech conglomerate Tencent is reportedly building its presence in Singapore and there seems to be a reason. At a time when Chinese investments are under fire in India, Tencent has invested $62.8 million in Indian e-commerce giant Flipkart, according to filings sourced by paper.vc.
The Flipkart investment could be a part of the $1.2 billion investment round led by its parent company Walmart. “There is the possibility though that Tencent’s investment is the first money in as part of this larger round involving Walmart and other shareholders,” said the paper.vc report.
With its latest investment, Walmart had increased its stake to about 82%, while Tencent reportedly continues to hold its 5% stake in Flipkart through its Singapore registered subsidiary Aceville. Flipkart had earlier said the $1.2 billion funding would come in two tranches.
Flipkart has not yet responded to Business Insider’s queries. The story will be updated as and when the response is received.
However, the investment from Tencent (which is unclear whether it’s through its Singaporean subsidiary) comes at a time when the Chinese tech company and its investments in India are being decried. There were even reports that in one of its unicorn investments in India, Dream11, Tencent was looking at selling its stake.
The Chinese conglomerate has had a tough month with bans and resentment coming its way from two of its big investment countries – India and the US. While India has banned over 150 Chinese apps including Tencent-backed PUBG due to the rising tensions along the border with China, in the US the Trump government has come down heavily on Tencent-owned WeChat.
And that’s why the tech giant might believe the Singapore-holding could make things easier. Singapore has been a safe haven for many Indian companies including Flipkart who are registered there to overcome tax hurdles, and the country is also increasingly becoming a gateway for Chinese companies into the South East Asian region.
“The new office is a strategic addition to our current offices in Malaysia, Indonesia and Thailand. The Singapore office will also enable us to capture potential from the rapid pace of digitisation and meet the demand for Internet-based services and solutions in Singapore,” Tencent told the Singapore-based Channel News Asia.
Apart from Tencent, other Chinese companies like Alibaba and ByteDance too have been looking at setting up Singapore offices.-Business Insider