Shares of game and media companies, which had been rallying on expectation of AI application, are sliding. Game developer Kunlun Tech plunging by the daily limit of 20% after the company third-largest shareholder, the founder’s ex-wife, plans to offload up to 3% of the firm’s stock.
Several other companies in the category including Alpha Group, Hangzhou Electronic Soul Network Technology, South China Publishing and Media, surged by the daily limit of 10%.
Kunlun Tech’s shareholder Li Qiong, the ex-wife of the firm’s founder and actual controller Zhou Yahui, will sell up to 35.9 million shares for personal reasons, accounting for 3% of its total share capital.
However, Li will lend over 50% of the proceeds (excluding tax) of the sales to Kunlun Tech with an annual interest rate of 2.5% and a term of three years to support the firm’s artificial intelligence business in the long run, the company said.
Self-made billionaire Zhou divorced his wife Li in 2016, marking the most expensive mainland divorce based on the amount of equity that exchanged hands after. Li bagged 298 million shares or over 24% of the total.
Li began selling her stake in the company in 2020 but still held over 11 percent of the shares in late March. Zhou is the second-biggest shareholder with his 12.2 percent stake.
The Shenzhen Stock Exchange issued a letter of concern to Kunlun Tech, asking for an explanation of whether the company manipulated of share prices to help shareholders’ stock offloading.
