Tencent Files for IPO

The Chinese streaming giant announced its long-anticipated listing after news of a truce in the U.S.-China trade war.
William SprouseDecember 4, 2018
Tencent Files for IPO

Tencent Music Entertainment Group filed to raise up to $1.2 billion in an initial public offering on the New York Stock Exchange. The company is looking to sell 82 million American Depositary Receipts between $13 and $15 share. The company could offer another 12.3 million shares through an over-allotment option.

Tencent Music runs a set of apps that let users listen to music, connect with people to sing karaoke, or watch live performances by pop stars. In its filing with regulators, the company said its four music apps have more than 800 million monthly active users.

A Better Way to Do Ecommerce

A Better Way to Do Ecommerce

Learn how Precision Medical leveraged OneWorld to cut the cost of billing in half and added $2.5M in annual revenue.

The filing follows news of a decision by China and the United States to call a 90-day hiatus on their trade war, which sent Asian stocks skyward on Monday.

According to a report from Reuters, Tencent originally planned to launch its IPO in mid-October, but the company decided to delay the IPO amid the steep global stock market sell-off. Citing a source close to the deal, Reuters said Tencent Music wanted to list this year because it was worried China-U.S. trade tensions would worsen.

“It’s not worth waiting any longer for a potentially higher valuation if they have to deal with so many uncertainties,” the source said.

At one point the company was reportedly seeking to raise up to $4 billion.

According to data provider Dealogic, 2018 is the most lucrative year for Chinese tech startups since 2014. More than 40 Chinese companies have sold roughly $15 billion in shares this year and account for 40% of the cash generated by technology IPOs globally. The Tencent IPO would be the third-largest IPO in the U.S. this year, following iQiyi, which raised $2.3 billion, and social shopping app Pinduoduo, which raised $1.6 billion.

Alibaba raised $25 billion in 2014.

The U.S. music-streaming service Spotify, which went public in April, owns a 9% stake in Tencent.

Understanding Which ERP Modules Your Business Needs – And When