An undisclosed investor sold 231 million Class B shares at HK$9.45 apiece, according to people with knowledge of the matter, a 5.1 percent discount to Tuesday's close. The placing follows the end of a six-month lockup last week that has allowed early shareholders to sell Xiaomi stock for the first time.
The shares fell as much as 2.7 percent Wednesday.
Xiaomi was one of the world's most hyped initial public offerings in recent years, with bankers initially touting a valuation of as much as $100 billion.
The Chinese smartphone maker's market capitalization has dropped to about $30 billion from a high of $61 billion reached after its Hong Kong debut — which, by one measure, was the city's biggest flop ever.
A flurry of off-exchange block trades last week signaled that many had taken the opportunity to offload the stock.
A fund backed by billionaire Yuri Milner — one of the world's most prolific startup investors — also distributed millions of Xiaomi shares to investors, reducing its stake to less than 4.99 percent. More shares will be unlocked for sale in July following a one-year restriction, while controlling shareholders last week said they'd hold on to their stakes for another year.
