Kling AI, a spin-off of Kuaishou Technology, is close to securing a $3 billion funding round that would value the company at $18 billion post-investment. This development comes as the company aims to enhance its position in China's competitive artificial intelligence video generation market, according to sources familiar with the matter.
Key Details
The funding round is backed by major investors, including Tencent, a leading Chinese video gaming and social media company. Initially, Kling AI had targeted a valuation of $20 billion when Kuaishou planned to spin off the company in April, but market sentiment has shifted since then. Kuaishou disclosed in a filing with the Hong Kong stock exchange that it is evaluating a proposal to restructure Kling AI, which may involve external fundraising.
Background
Kuaishou is also expected to initiate the Hong Kong stock exchange listing process for Kling AI within the next year. The proceeds from the initial public offering will likely be allocated towards building out computing and data centers, as well as acquiring and retaining talent. Kuaishou's shares closed up 1.46% at HK$41.60 (approximately $5.30) on Wednesday.
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Sources: scmp.com, theguardian.com.
This funding round could impact the technology sector, particularly companies involved in AI and video generation, as it highlights the growing investment interest in these areas. Investors will watch for the timeline of Kling AI's IPO and how it will affect Kuaishou's overall market position.