Renren Inc, regarded by many as China's Facebook, will dispose all assets in its social networking service business for a cash consideration of $20 million, the company announced on Wednesday.

Beijing Qianxiang Wangjing Technology Development Co Ltd, a China-incorporated subsidiary wholly controlled by Renren, has agreed to sell all tangible and intangible assets in www.renren.com and its related Renren SNS business to Beijing Infinities Interactive Media Co Ltd, according to the announcement.

Infinities Technology (Cayman) Holding Limited, the buyer's parent company, has agreed to issue to Renren shares of the company with a value of $40 million, based on an agreed-upon estimated valuation of the buyer's parent company at $700 million.

Renren said the asset sale transaction is the most viable path to dispose of its Renren SNS business so the company can be geared for the next phase of growth.

"I am happy to find a home for renren.com," said Joseph Chen, Renren's chairman and chief executive officer. "Looking ahead, our company will be serving global, vertical industries with internet and artificial intelligence."

After completion of this transaction, Renren will focus on used car business in China and businesses outside China, including the Trucker Path business and software as a service business in the United States.

Renren also intends to remain listed on the New York Stock Exchange, the announcement said.

Renren's American depositary shares, each of which represents fifteen Class-A ordinary shares, gained 8.57 percent to $1.52 on Tuesday, according to the latest statistics from the New York Stock Exchange.