INSUBCONTINENT EXCLUSIVE:
Fresh from Spotify unique direct listing in the U.S., another huge streaming service is about to follow suit and go public in
America.
Tencent Music Entertainment (TME) has nothing like the global profile of Spotify, but China top streaming service is heading for
public markets according to a filing made this weekend by parent company Tencent, the $500 billion Chinese internet giant which plans to
spin the music business out.
At this point, specific financial details around the listing aren&t being released, but past reports have
suggested that it could raise as much as $1 billion and give TME a valuation of $30 billion.That would be quite a jumpfrom its most recent
$12 billion valuationand certainly not guaranteed given that others from China, including Xiaomi, has fallen short of ambitious IPO
valuation targets.
But there precedent here sinceTencent made a similar move last year when it broke off China Literature, its digital
books business unit, and listed it in Hong Kongwith some success
Hong Kong had also been mooted as a destination for TME, but the Tencent filing stated the firm intention to &spin-off by way of a separate
listing… on a recognized stock exchange in the United States.&
While it seems unlikely that Tencent will follow Spotify and adopt a
direct listing — which ditches with the conventional process of an IPO price and engaging banks — it may well call on its rival for
pointers since they are both mutual investors.
The duoannounced an equity swap deal in December that could see themteam up on business in
At the time it was certainly a sign that both sides were getting into shape to go public, and TME IPO would wrap that up.
