Tencent in talks with Warner Music Group regarding a $200 million stake
The Chinese tech giant Tencent is reportedly looking forward to buying a huge stake in Warner Music Group, which could allegedly be as large as $200 million ahead of an IPO that is expected to cost around $23-$26 per share. It was initially scheduled for February 2020 but had to be delayed due to coronavirus concerns.
According to the Wall Street Journal, the IPO is predicted to give the company a valuation of around $13.3 billion, thus possibly making it the largest New York IPO to date in 2020. Tencent was recently in the headlines when it stepped forward to buy 10% of Universal Music Group for $3.4 billion, while reserving the right to buy another 10% on the same terms by January 15, 2021. The streaming giant’s music platform Tencent Music Entertainment (TME) is often described as China’s Spotify, which currently boasts around 700 million active users.
Warner Music Group, currently home to some top-notch artists including Ed Sheeran, Camila Cabello, Cardi B, etc. recently announced a $100 million dollar fund to support the Black Lives Matter movement. Amidst all the protests and the COVID-19 crisis, it would be interesting to see how this IPO plays out.