This article was first published on October 2, 2018.
New York
UJ Business
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Tencent Music has announced its plans to launch an IPO in the United States, potentially becoming one of the largest IPOs by a Chinese firm in recent times.
The company has set a preliminary target of $1 billion, which might place its valuation between $25 and $30 billion, based on their SEC filing.
If achieved, this would be the third-largest IPO by a Chinese company to take place in the United States since the beginning of 2018, as reported by Dealogic. In comparison, iQIYI, a Netflix-like platform, raised $2.3 billion, while Pinduoduo, a social shopping app, gathered $1.6 billion.
Tencent Music leads the music streaming sector in China, powered by its apps resembling Spotify. The SEC filing revealed that the company’s music platforms engage over 800 million monthly active users. Notably, Spotify holds a 9% stake in Tencent Music.
For the first half of 2018, Tencent’s entertainment division reported a profit of $263 million with revenues totaling $1.3 billion.
In its filing, the company stated, “We are at the forefront of transforming how individuals experience online music and music-oriented social entertainment services,” and it expects the number of paid music subscribers in China to “increase more than fourfold from 2017 to 2023.”
The intended stock symbol is TME, though the company has yet to determine whether it will list on the Nasdaq or the New York Stock Exchange.
UJ first reported in July that Tencent Music was considering an IPO in the United States.
Tencent Music’s upcoming IPO occurs amid a series of significant listings by other Chinese tech firms in recent months, including the smartphone manufacturer Xiaomi and online services provider Meituan Dianping.
