<p>Chinese tech giant Tencent said it has made peace with the country's best-known chilli oil maker Lao Gan Ma, after an advertising scam that bewildered many and generated a public relations nightmare.</p>.<p>After thorough communication with Lao Gan Ma - which translates as "old godmother" - the two sides have cleared up any misunderstanding and Tencent has apologised for inconvenience and improper handling of the situation, a joint statement on Chinese blogging website Weibo said on Friday.</p>.<p>A Shenzhen court last week said it would freeze 16.24 million yuan ($2.3 million) in assets belonging to Lao Gan Ma at the request of Tencent Holdings Ltd (0700.HK), which had sued the manufacturer for failing to pay advertising fees under a 2019 contract.</p>.<p>Police in the southern city of Guiyang later said they had arrested three people accused of forging Lao Gan Ma's company seal - used in China to formalise documents - and pretending to be staff from the firm's marketing department who signed a cooperation agreement with Tencent.</p>.<p>The incident drew nationwide attention as netizens poked fun at the idea Tencent's elaborate video game and esports-related campaigns had served to promote a chilli maker.</p>.<p>Tencent said in the statement it has retracted its court application for property preservation and related litigation, and thanked local police for busting the alleged fraudsters.</p>.<p>The two sides would explore formal cooperation, the statement said, without giving details.</p>.<p>Tencent, China's biggest social media and video game company, is under pressure to maintain high growth of its advertising business as it seeks to weather the disruption caused by the COVID-19 pandemic.</p>.<p>Lao Gan Ma, headquartered in Guiyang, is one of China's best-known food brands, selling millions of bottles of its red-labelled chilli oil at home and abroad annually.</p>
<p>Chinese tech giant Tencent said it has made peace with the country's best-known chilli oil maker Lao Gan Ma, after an advertising scam that bewildered many and generated a public relations nightmare.</p>.<p>After thorough communication with Lao Gan Ma - which translates as "old godmother" - the two sides have cleared up any misunderstanding and Tencent has apologised for inconvenience and improper handling of the situation, a joint statement on Chinese blogging website Weibo said on Friday.</p>.<p>A Shenzhen court last week said it would freeze 16.24 million yuan ($2.3 million) in assets belonging to Lao Gan Ma at the request of Tencent Holdings Ltd (0700.HK), which had sued the manufacturer for failing to pay advertising fees under a 2019 contract.</p>.<p>Police in the southern city of Guiyang later said they had arrested three people accused of forging Lao Gan Ma's company seal - used in China to formalise documents - and pretending to be staff from the firm's marketing department who signed a cooperation agreement with Tencent.</p>.<p>The incident drew nationwide attention as netizens poked fun at the idea Tencent's elaborate video game and esports-related campaigns had served to promote a chilli maker.</p>.<p>Tencent said in the statement it has retracted its court application for property preservation and related litigation, and thanked local police for busting the alleged fraudsters.</p>.<p>The two sides would explore formal cooperation, the statement said, without giving details.</p>.<p>Tencent, China's biggest social media and video game company, is under pressure to maintain high growth of its advertising business as it seeks to weather the disruption caused by the COVID-19 pandemic.</p>.<p>Lao Gan Ma, headquartered in Guiyang, is one of China's best-known food brands, selling millions of bottles of its red-labelled chilli oil at home and abroad annually.</p>