Kling now carries investor redemption rights tied to an October 2031 IPO deadline, putting a clock on Kuaishou's reported plan to list its fastest-growing AI business separately.
Kuaishou’s video-generation business, Kling AI, has closed the capital increase it announced in July, collecting about RMB19.8 billion from outside investors, the Hong Kong-listed parent said on October 30. The final amount fell about RMB645 million short of the RMB20.447 billion ceiling the company set in July, because two investors did not pay on time, according to STAR Market Daily, whose report was republished by Sina Finance. Software maker Kingdee and a unit of GPU designer MetaX were among the buyers that took over part of the unpaid commitments.
Kuaishou describes the round as the largest single financing ever for a video model developer, according to TechWeb, as republished by Sina Tech. Kuaishou keeps control: its holding vehicle Lucky Labs owns 66.68% of the equity and 52.45% of the voting rights in Beijing Kling, the company that now holds the Kling business, Reuters reported in a story carried by The Standard.
What remains unclear is how the money will be spent. Reuters said Kuaishou did not disclose how Kling will use the proceeds, and Kuaishou’s filing does not give a new valuation. Kling’s owners have, however, accepted terms that tie the investment to a listing.
Two investors dropped out and five buyers took most of their place
When Kuaishou announced the deal on July 2, it set the ceiling at RMB20.447 billion and had about RMB19.048 billion confirmed, TechWeb reported. Reuters put the July round at US$2.8 billion, at a pre-money valuation of US$15 billion, with Alibaba and Tencent among the backers. More investors joined later, including China’s national AI industry investment fund, which committed RMB1.4 billion in late August, as EastFrontier reported at the time.
Two investors failed to complete their payments. BFI MIDCO’s unpaid US$80 million commitment, about RMB545 million, was cancelled in full. Dakang Lanwu (达康兰五) had pledged RMB880 million; RMB780 million of that was transferred to other investors and the remaining RMB100 million will not be paid, according to STAR Market Daily, which described both as linked to the Middle Eastern investor BlueFive. Kuaishou said the terminations resulted from objective reasons not attributable to any party, and both entities are no longer investors.
Five buyers took over the transferred RMB780 million. Kingdee’s software unit put in RMB300 million and a unit of Shanghai-listed GPU maker MetaX put in RMB55 million through the transfer, both as first-time investors. The rest came from three investment vehicles: Wenzhou Ruida with RMB210.45 million, Gongqingcheng Junke with RMB200 million and Ningbo Zhichun Huayan with RMB14.55 million, Kuaishou’s filing shows. Through a separate transfer from an existing investor, MetaX’s total stake reached RMB100 million, about 0.08% of Beijing Kling, a figure consistent with the RMB100 million Reuters reported for the MetaX unit.
The new shareholders bring industrial ties and a 2031 deadline
The newcomers matter more for who they are than for what they paid. Kingdee’s parent, Kingdee International, is listed in Hong Kong, and MetaX makes GPUs for AI computing, the kind of hardware video models need for training and generation. STAR Market Daily asked MetaX whether the investment came with a commercial relationship, such as chip purchases or adapting Kling’s models to MetaX hardware. The company’s investment department said it did not yet have the information and would reply later; no answer had been received by publication.
The financing also carries an exit clause. If Beijing Kling does not complete an IPO by October 30, 2031, or cannot finish the regulatory procedures for its restructuring within nine months, investors can require the company to buy back their shares at their original cost plus 8% simple annual interest, STAR Market Daily reported. Kingdee and the MetaX unit received the same repurchase rights as the investors they replaced.
The business behind the valuation is growing quickly. Kling’s revenue exceeded RMB850 million in the second quarter, up more than 200% from a year earlier and 30.8% from the first quarter, according to TechWeb. The company released Kling 4.0 on October 15, supporting native videos of up to 30 seconds. Reuters noted that Kling competes with video models from OpenAI, Google and ByteDance.
A Hong Kong listing is the next test
Bloomberg reported in October that Kling plans an IPO next year, according to Reuters. STAR Market Daily cited reports that China International Capital Corp., Goldman Sachs and UBS have been chosen as underwriters for a Hong Kong listing raising at least US$1 billion, while noting the arrangements are at an early stage and that Kuaishou did not respond. EastFrontier examined what that listing would have to prove in its look at Kling’s IPO push.
The listing would also put a public price on a business that private investors valued at US$15 billion before July’s new money. The repurchase clause gives investors protection if the listing slips, but it also means Kuaishou carries a contingent obligation if Beijing Kling stays private past 2031.
The next concrete signal will be Kuaishou’s third-quarter results, where investors will look for Kling’s latest quarterly revenue and any statement on how the RMB19.8 billion will be spent on computing capacity. A confidential or public Hong Kong filing by Beijing Kling would confirm the timetable that so far rests on unnamed sources.