Xunlei Limited Announces Entry into Definitive Agreements for Disposition of Majority Equity Interest in Shenzhen Onething

Rhea-AI Summary

Xunlei (Nasdaq: XNET) agreed to sell a combined 50% equity interest in Shenzhen Onething for RMB125 million in two transactions: 20% to Wuhan Kingsoft Cloud for RMB50 million and 30% to management vehicle Xinghan Zhilian for RMB75 million.

Post-closing, Xunlei will retain 20%, will no longer consolidate Shenzhen Onething, received a fairness opinion from Kroll, and expects closing by end of April, subject to customary approvals and closing conditions.

Positive

• RMB125 million cash consideration for 50% equity sale
• Retention of a 20% minority stake to participate in future upside
• Transaction reviewed with a Kroll fairness opinion and audit committee approval
• Expected closing by end of April 2026, providing near-term execution timeline

Negative

• Loss of control: Xunlei reduces stake from 70% to 20% and will not consolidate results
• Closing conditionality: Wuhan Kingsoft Cloud closing depends on Xinghan Zhilian closing
• Staged payments: Xinghan Zhilian pays 80% of consideration at closing, creating execution risk

Key Figures

Total equity sold: 50% equity interest Total consideration: RMB125 million Stake to Wuhan Kingsoft Cloud: 20% equity, RMB50 million +5 more

8 metrics

Total equity sold 50% equity interest Aggregate stake in Shenzhen Onething to be transferred

Total consideration RMB125 million Aggregate cash consideration for 50% Shenzhen Onething stake

Stake to Wuhan Kingsoft Cloud 20% equity, RMB50 million Equity transfer to Wuhan Kingsoft Cloud (inclusive of tax)

Stake to Xinghan Zhilian 30% equity, RMB75 million Equity transfer to management holding vehicle (inclusive of tax)

Installment 1 to Xinghan RMB15 million (20%) First installment within ten business days of signing

Installment 2 to Xinghan RMB60 million (80%) Second installment on closing date of Xinghan transaction

Pre-transaction ownership 70% equity interest Shenzhen Xunlei’s stake in Shenzhen Onething before transaction

Post-transaction ownership 20% equity interest Shenzhen Xunlei’s retained minority stake in Shenzhen Onething

Market Reality Check

Price: $5.73 Vol: Volume 191,181 is slightl...

normal vol

$5.73 Last Close

Volume Volume 191,181 is slightly below the 20-day average of 203,934 (relative volume 0.94). normal

Technical Shares trade 48.05% below the 52-week high and 102.83% above the 52-week low, and are currently below the 200-day MA at 6.69.

Peers on Argus

XNET was up 0.17% while several peers showed stronger gains (e.g., ALLT +7.56%, ...

XNET was up 0.17% while several peers showed stronger gains (e.g., ALLT +7.56%, ARQQ +7.25%, GRRR +9.2%). With peer_momentum scanners showing no coordinated move, the pricing around this deal appears stock-specific rather than sector-driven.

Historical Context

2 past events · Latest: Nov 13 (Positive)

Pattern 2 events

Date	Event	Sentiment	Move	Catalyst
Nov 13	Q3 2025 earnings	Positive	-2.3%	Strong Q3 revenue growth and net income driven by fair-value gain.
Nov 06	Earnings call notice	Neutral	-5.0%	Announcement of date and time for upcoming Q3 2025 results release.

Pattern Detected

Recent headlines, including strong Q3 2025 earnings and an earnings call scheduling notice, were followed by negative price reactions, suggesting a tendency for shares to trade lower around news events.

Recent Company History

Over the past several months, Xunlei focused on financial reporting and capital markets transparency. The company released unaudited Q3 2025 results on Nov 13, 2025, highlighting strong revenue growth and profitability metrics, but the stock fell 2.26% over the next day. A prior announcement on Nov 6, 2025 merely scheduled that earnings release, yet shares declined 4.98%. Today’s business portfolio move contrasts with that earlier, earnings-centric flow of news.

Market Pulse Summary

This announcement details Xunlei’s plan to divest a 50% equity stake in Shenzhen Onething for RMB125...

Analysis

This announcement details Xunlei’s plan to divest a 50% equity stake in Shenzhen Onething for RMB125 million, shifting from a 70% controlling interest to a 20% minority position and deconsolidating its results. Investors may focus on how this reshapes the business mix, the governance framework under the new shareholders agreement, and the company’s stated goal of optimizing resources amid regulatory changes.

Key Terms

variable interest entity, definitive agreements, fairness opinion, closing conditions

4 terms

variable interest entity regulatory

"its variable interest entity in China, Shenzhen Xunlei Networking Technologies Co., Ltd."

A variable interest entity (VIE) is a company structure where one party controls another company’s operations and economic outcomes through contracts or special arrangements instead of owning a majority of its voting shares. For investors, VIEs matter because the controlling party’s financial results, debts and risks can appear in the controller’s reports even though ownership looks separate, so understanding VIEs helps assess true exposure, governance limits and transparency—like spotting a puppet controlled by strings rather than direct ownership.

definitive agreements financial

"has entered into definitive agreements to transfer an aggregate 50% equity interest"

Definitive agreements are the final, legally binding contracts that set the exact terms of a corporate deal—such as a merger, acquisition, asset sale, or major financing. They matter to investors because signing them turns rough plans into concrete obligations that determine price, timing, required approvals and what happens if the deal falls through; think of them as the signed purchase contract in a house sale that makes the deal official and enforceable.

fairness opinion financial

"Kroll LLC served as an independent financial advisor to the audit committee and issued a fairness opinion."

A fairness opinion is a professional assessment that evaluates whether the terms of a financial deal, such as a merger or acquisition, are fair from a financial point of view. It helps investors and stakeholders understand if the deal is reasonable and balanced, much like an independent expert giving an unbiased judgment on whether a price or agreement is fair. This assurance can increase confidence that the transaction is fair for all parties involved.

closing conditions regulatory

"The Transaction is subject to certain closing conditions, including, among others"

Closing conditions are specific requirements or steps that must be met before a financial deal or transaction can be finalized. They act like a checklist that ensures all necessary details are confirmed and agreed upon, giving both parties confidence that the deal is ready to be completed. Meeting these conditions is essential for the transaction to move forward smoothly and successfully.

AI-generated analysis. Not financial advice.

SHENZHEN, China, March 03, 2026 (GLOBE NEWSWIRE) -- Xunlei Limited (“Xunlei” or the “Company”) (Nasdaq: XNET), a leading technology company providing distributed cloud services in China, today announced that its variable interest entity in China, Shenzhen Xunlei Networking Technologies Co., Ltd. (“Shenzhen Xunlei”), has entered into definitive agreements to transfer an aggregate 50% equity interest in Shenzhen Onething Technology Co., Ltd. (“Shenzhen Onething”) for an aggregate cash consideration of RMB125 million.

Pursuant to the terms of the definitive agreements, Shenzhen Xunlei will transfer (i) 20% of the equity interest in Shenzhen Onething to Wuhan Kingsoft Cloud Information Technology Co., Ltd. (“Wuhan Kingsoft Cloud”), a variable interest entity of Kingsoft Cloud Holdings Limited (Nasdaq: KC; HKEX: 3896) (“Kingsoft Cloud”), for a cash consideration of RMB50 million (inclusive of tax) (the “Wuhan Kingsoft Cloud Equity Transfer Transaction”); and (ii) 30% of the equity interest in Shenzhen Onething to Shenzhen Xinghan Zhilian Technology Co., Ltd. (“Xinghan Zhilian”), a holding vehicle for Onething’s management team consisting of Mr. Hao Li, Mr. Yingqiao Liu, and Mr. Lei Wu, for a cash consideration of RMB75 million (inclusive of tax) (the “Xinghan Zhilian Equity Transfer Transaction”, together with the Wuhan Kingsoft Cloud Equity Transfer Transaction, collectively the “Transaction”).

Prior to the closing of the Transaction, Shenzhen Xunlei held 70% of the equity interest in Shenzhen Onething. Upon completion of the Transaction, Shenzhen Xunlei will retain a 20% equity interest in Shenzhen Onething. As a result, the Company will not consolidate the financial results of Shenzhen Onething after the closing of the Transaction.

The consideration of the Transaction was determined by the parties after arm’s length negotiations and taking into account, among others: (1) the unaudited net asset value of Shenzhen Onething as of December 31, 2025; (2) the current market conditions and the prospects of the Shenzhen Onething; and (3) the respective equity interest percentage of Shenzhen Onething to be acquired by Wuhan Kingsoft Cloud and Xinghan Zhilian.

Under the terms of the definitive agreements, the obligations of Wuhan Kingsoft Cloud and Xinghan Zhilian to pay their respective considerations and complete their transfers are separate. The closing of the Wuhan Kingsoft Cloud Equity Transfer Transaction is conditional upon the completion of the Xinghan Zhilian Equity Transfer Transaction. However, the closing of the Xinghan Zhilian Equity Transfer Transaction is not conditional on the completion of the Wuhan Kingsoft Cloud Equity Transfer Transaction. Xinghan Zhilian will pay the total consideration of RMB75 million in two installments: the first installment of 20% (i.e. RMB 15 million) is payable within ten business days of the signing of the definitive agreements; the remaining 80% (i.e. RMB 60 million) will be payable on the closing date of the Xinghan Zhilian Equity Transfer Transaction. Wuhan Kingsoft Cloud will pay the total consideration of RMB50 million in a single installment on the closing date of the Wuhan Kingsoft Cloud Equity Transfer Transaction. Upon closing of the Transaction, all shareholder rights in Shenzhen Onething will be held by the shareholders according to their respective equity interest ratios, subject to the provisions of the shareholders agreement of Shenzhen Onething and other transaction documents concerning the Transaction. 

The Transaction is subject to certain closing conditions, including, among others, (i) obtaining all necessary corporate approvals from the relevant governing bodies of Shenzhen Onething, Shenzhen Xunlei, and the Company, which authorize the execution and performance of the transaction agreements; (ii) the fulfillment by the Company of its disclosure obligations in accordance with the requirements of the U.S. Securities and Exchange Commission; and (iii) solely with respect to Wuhan Kingsoft Cloud, the condition that the share transfer to Xinghan Zhilian Equity Transfer Transaction be completed on the same date as the proposed completion of the Wuhan Kingsoft Cloud Equity Transfer Transaction. Subject to the terms of the definitive agreements, the closing of the Transaction shall take place no later than ten business days following the date on which all conditions precedent have been satisfied or waived. Alternatively, the parties may also mutually agree in writing to an alternative time and date for the closing of the Transaction.

Additionally, in connection with the Transaction, the parties entered into a shareholders agreement that establishes the post-closing governance framework for Shenzhen Onething.

The audit committee of the board of directors of the Company, each of whom is an independent and disinterested director of the Board, led the evaluation and negotiation of the Transaction on behalf of the Company. Kroll LLC served as an independent financial advisor to the audit committee and issued a fairness opinion. The board of directors of the Company, acting upon the unanimous recommendation of the audit committee, resolved that the Transaction is in the Company’s best interest and is fair to the Company from a financial point of view and approved the Transaction. The Transaction is expected to close by the end of April.

The Transaction is expected to optimize the Company’s resource allocation and business portfolio, as well as mitigate the impact of the evolving regulatory environment, while allowing the Company to retain a minority stake and participate in Shenzhen Onething’s future growth.

About Xunlei

Founded in 2003, Xunlei Limited (Nasdaq: XNET) is a leading technology company providing distributed cloud services in China. Xunlei provides a wide range of products and services across cloud acceleration, shared cloud computing and digital entertainment to deliver an efficient, smart and safe internet experience.

About Kingsoft Cloud and Wuhan Kingsoft Cloud

Kingsoft Cloud was incorporated under the laws of the Cayman Islands on January 3, 2012 as an exempted company with limited liability, the ADSs of which are listed on Nasdaq under the symbol of “KC” on May 8, 2020 and the shares of which are listed on the main board of the Hong Kong Stock Exchange under the stock code “3896” and stock short name “KINGSOFT CLOUD” on December 30, 2022.

Kingsoft Cloud is a leading cloud service provider in China. With extensive cloud infrastructure, cutting-edge cloud-native products based on vigorous cloud technology research and development capabilities, well-architected industry-specific solutions and end-to-end fulfillment and deployment, Kingsoft Cloud offers comprehensive, reliable and trusted cloud service to customers in strategically selected verticals.

Wuhan Kingsoft Cloud is a limited liability company established and subsisting under the laws of China, primarily engaged in cloud services, and is a variable interest entity of Kingsoft Cloud.

About Shenzhen Onething

Shenzhen Onething is a limited liability company established and existing under the laws of the PRC, with a registered capital of RMB380 million. Shenzhen Onething principally engages in edge computing-based content delivery network (CDN) and acceleration services and other related businesses.

Set out below are the unaudited profit/loss before and after tax of Shenzhen Onething for the two financial years ended December 31, 2024 and 2025 prepared in accordance with China Accounting Standards for Business Enterprises:

		Year ended December 31, 2024	Year ended December 31, 2025
		RMB (in million)	RMB (in million)
		(Unaudited)	(Unaudited)
	Profit/(loss) before tax	(21.3)	12.4
	Profit/(loss) after tax	(21.4)	9.9

According to the unaudited financial statements of Shenzhen Onething for the years ended December 31, 2024 and 2025 prepared in accordance with China Accounting Standards for Business Enterprises, the total assets of Shenzhen Onething as of December 31, 2024 and 2025 were RMB398.0 million and RMB522.1 million respectively, and the net liabilities of Shenzhen Onething as of December 31, 2024 were RMB668.2 million and the net assets of Shenzhen Onething as of December 31, 2025 were RMB240.0 million.

According to the definitive agreements of the Transaction, immediately before and after the completion of the Transaction, the equity interest of Shenzhen Onething is as follows:

	Percentage of shareholding in Shenzhen Onething
	Immediately before completion of the Transaction	Immediately after completion of the Transaction
Shenzhen Xunlei	70.00%	20.00%
Wuhan Kingsoft Cloud	–	20.00%
Xinghan Zhilian	–	30.00%
Mr. Hao Li	5.00%	5.00%
Mr. Jinbo Li	4.00%	4.00%
Mr. Yubo Zhang	4.00%	4.00%
Nanjing Kehui Zhitu Information Technology Partnership (Limited Partnership)	4.00%	4.00%
Nanjing Yimang Yuelian Information Technology Partnership (Limited Partnership)	4.00%	4.00%
Nanjing Yuxin Jike Information Technology Partnership (Limited Partnership)	3.50%	3.50%
Nanjing Zhihui Yuandong Information Technology Partnership (Limited Partnership)	3.50%	3.50%
Nanjing Zhongzhi Gongchuang Information Technology Partnership (Limited Partnership)	2.00%	2.00%

Note: Nanjing Kehui Zhitu Information Technology Partnership (Limited Partnership) , Nanjing Yimang Yuelian Information Technology Partnership (Limited Partnership), Nanjing Yuxin Jike Information Technology Partnership (Limited Partnership), Nanjing Zhihui Yuandong Information Technology Partnership (Limited Partnership) and Nanjing Zhongzhi Gongchuang Information Technology Partnership (Limited Partnership) are employee incentive platforms established for the purpose of the employee share incentive scheme of Shenzhen Onething, and have no substantive business activities.

About Shenzhen Xunlei, Xinghan Zhilian and Other Parties of the Transaction

Shenzhen Xunlei is a limited liability company established and existing under the laws of the PRC, primarily engaging in internet business. It is a variable interest entity that is contractually controlled by Xunlei.

Xinghan Zhilian is a limited liability company established and existing under the laws of China, which is the related party to the Company. As at the date of this announcement, Xinghan Zhilian is held as to 70%, 16.67% and 13.33% by Mr. Hao Li, Mr. Lei Wu and Mr. Yingqiao Liu, respectively. Xinghan Zhilian is an entity established by Mr. Hao Li, Mr. Lei Wu and Mr. Yingqiao Liu for the purpose of completing the Transaction, and has no substantive business activities. Mr. Hao Li, Mr. Lei Wu, Mr. Yingqiao Liu are the chief executive officer, the chief technology officer and a vice president of Shenzhen Onething, respectively.

Safe Harbor Statement

This press release contains statements of a forward-looking nature. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as “will,” “expects,” “believes,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Among other things, the Company’s business outlook, the Company’s strategic, operational, disposition, and acquisition plans, and plans and other applicable descriptions concerning the Transaction, contain forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the Company and the industry. Forward-looking statements involve inherent risks and uncertainties, including but not limited to: the Company’s ability to continue to innovate and provide attractive products and services to retain and grow its user base; the Company’s ability to keep up with technological developments and users’ changing demands in the internet industry; the Company’s ability to convert its users into subscribers of its premium services; the Company’s ability to deal with existing and potential copyright infringement claims and other related claims; the risk that health risks in China or globally could adversely affect the Company’s operations or financial results; the Company’s ability to react to the governmental actions for its scrutiny of internet content in China, the Company’s ability to compete effectively. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results. Further information regarding risks and uncertainties faced by the Company is included in the Company’s filings with the U.S. Securities and Exchange Commission. All information provided in this press release is as of the date of the press release, and the Company undertakes no obligation to update any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law.

CONTACT:
Investor Relations
Xunlei Limited
Email: ir@xunlei.com
Tel: +86 755 8633 8443
Website: http://ir.xunlei.com

FAQ

What did Xunlei (XNET) agree to sell in the Shenzhen Onething deal on March 3, 2026?

Xunlei agreed to transfer an aggregate 50% equity interest in Shenzhen Onething for RMB125 million. According to the company, 20% goes to Wuhan Kingsoft Cloud for RMB50 million and 30% to management vehicle Xinghan Zhilian for RMB75 million.

How will the Shenzhen Onething transaction affect Xunlei (XNET) financial consolidation?

After closing, Xunlei will retain 20% and will not consolidate Shenzhen Onething's results. According to the company, the reduced stake removes control and ends consolidation of Onething's financials post-closing.

When is the Shenzhen Onething transaction for Xunlei (XNET) expected to close?

The parties expect the Transaction to close by end of April 2026, subject to conditions. According to the company, closing depends on corporate approvals, disclosure obligations, and certain interdependent closing conditions.

What are the payment terms for the Xunlei (XNET) sale of Shenzhen Onething equity?

Total consideration is RMB125 million, with Xinghan Zhilian paying RMB75 million in two installments and Wuhan Kingsoft Cloud paying RMB50 million at closing. According to the company, Xinghan Zhilian pays 20% within ten business days and 80% at close.

Does Xunlei (XNET) have independent review or board approval for the Shenzhen Onething sale?

Yes. The audit committee led negotiations and obtained a fairness opinion from Kroll, and the board unanimously approved the Transaction. According to the company, independent directors concluded the deal is fair from a financial perspective.

What governance changes occur at Shenzhen Onething after Xunlei's (XNET) sale?

Post-closing, shareholder rights will follow equity ratios under a new shareholders agreement. According to the company, the agreement sets the post-closing governance framework among Shenzhen Onething shareholders and transaction parties.