One of the richest gaming billionaires has had one of the world’s biggest wealth plunges.
Forrest Li, the chairman and chief executive officer of Sea, has lost US$10 billion of his fortune since the American depositary receipts of the company peaked on Oct. 19, according to the Bloomberg Billionaires Index. After growing competition and a wider profit loss, the latest blow came on Tuesday, when Tencent Holdings cut its stake in the gaming and e-commerce giant, driving the stock to its worst slump in almost two years.
Li became Singapore’s richest person last year as the company benefited from a surge in demand for gaming and online shopping amid the Covid-19 pandemic. But things soon started turning sour as Sea faced profitability concerns amid fierce competition and rivals’ public debuts. Even before Tencent’s move, its ADRs were down 39% from the high in October.
Tencent said Tuesday it is cutting its Sea stake to 18.7% from 21.3%, with its voting rights decreasing to under 10%. The move followed an earlier statement from Sea saying it is seeking to increase the voting power of its Class B shares and that Tencent would convert all such stock into Class A shares, resulting in Li becoming the beneficial owner of all outstanding Class B securities. The change, which is subject to a shareholders’ vote next month, would effectively increase Li’s voting power to about 57% from 54%.
Sea, based in Singapore and traded in the U.S., became Southeast Asia’s most valuable company thanks to the success of its e-commerce platform Shopee and mobile game Free Fire, which has surpassed 1 billion downloads on Google Play. Gang Ye and David Chen, who started the company with Li in 2009, have fortunes valued at US$6.3 billion and US$2.1 billion, respectively.
Now Li is worth US$11.8 billion, with his wealth plunging by $1.5 billion on Tuesday alone. He’s Singapore’s third-richest person, following Li Xiting of medical-equipment maker Shenzhen Mindray Bio-Medical Electronics Co. and Nippon Paint Holdings Co.’s Goh Cheng Liang. Since Sea’s peak on Oct. 19, only Colin Huang of e-commerce platform Pinduoduo Inc. and Amancio Ortega, the founder of the Zara clothing brand, have lost more wealth than Li, according to the Bloomberg Billionaires Index.
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A Sea representative didn’t immediately respond to a request for comment. Photo: Samual Isaac Chua of The Edge Singapore
