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Tencent to spin-off online music unit Tencent Music for US listing

The planned IPO could see Tencent Music valued at between US$29 billion to US$31 billion, according to reports

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Tencent said it is looking to spin-off its online music streaming unit for a US listing in an announcement issued Sunday. Photo: Reuters

Tencent, the Chinese social media and gaming juggernaut, has proposed to spin-off its online music streaming business Tencent Music for a separate listing in the US, which could also profit Spotify, an investor in Tencent Music and its strategic partner in China.

Tencent plans to spin-off its majority-owned Tencent Music Entertainment Group and list it separately in the US, Tencent said in a filing to the Hong Kong stock exchange on Sunday evening.

The Hong Kong exchange has confirmed that the company may proceed with the proposed spin-off, it added.

The terms of the spin-off, including the offering size, price range, and how many shares in Tencent Music that the existing shareholders of Tencent will get, have not yet been finalised.

The spin-off is subject to the approvals from relevant authorities and final decisions by the boards of Tencent and Tencent Music, Tencent said.

The IPO will also profit Spotify, which owns 9 per cent of Tencent Music after a joint equity investment deal in December that saw Tencent and Spotify take a stake in each other’s music streaming businesses. Tencent owns a 7.5 per cent stake in Spotify.

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