ANZ Australia And New Zealand Banking Group Limited

Tencent Holdings Ltd. is increasing the amount of its planned bank loan to as much as $4 billion, people familiar with the matter said, as the Chinese Internet giant beefs up its war chest for potential acquisitions.

Tencent was in talks with banks to raise $2 billion in a syndicated loan, The Wall Street Journal reported last month. But the loan's syndication has been heavily oversubscribed, and the company now plans to raise more than $3 billion and up to $4 billion, the people said. The additional funds could help Tencent finance more acquisitions, the people said.

Tencent, a social-network company that operates the WeChat smartphone messaging application, and its chief rival, online shopping company Alibaba Group Holding Ltd., have been raising billions of dollars in bank loans over the past several months to finance their expansion through acquisitions in China and abroad. In November, Tencent secured $1.5 billion in a syndicated loan.

Five banks—Citigroup Inc., Australia & New Zealand Banking Group, Bank of China, HSBC Holdings PLC and Mizuho Financial Group Inc.—are underwriting Tencent's latest syndicated loan, according to the people. The loan is expected to be completed this month, the people said.

Tencent has been ramping up investments in a wide range of businesses. It is a major investor, for example, in Chinese ride-sharing company Didi Chuxing Technology Co., which this month received a $1 billion investment from Apple Inc. In January, Tencent and other investors took part in a $3.3 billion funding round for Meituan-Dianping, China's biggest online provider of restaurant bookings, movie ticketing and other on-demand services.

Write to Juro Osawa at juro.osawa@wsj.com

(END) Dow Jones Newswires

May 16, 2016 00:05 ET (04:05 GMT)

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