China's biggest streaming-music service is reportedly postponing its US IPO because of stock-market volatility
- Tencent Music is reportedly delaying its US initial public offering because of stock-market volatility.
- The offering could value the business in excess of $25 billion, making it one of the biggest IPOs ever for a technology company.
- US markets just suffered their steepest drop since February as concerns about rising interest rates and trade tensions sparked a sharp sell-off.
- Tencent Music's parent company Tencent has had more than $200 billion of market value wiped out since February.
Tencent Music Entertainment is reportedly delaying its US initial public offering because of the recent stock-market volatility.
The IPO, which was initially scheduled for October 18, will be postponed until at least November, The Wall Street Journal reported on Thursday, citing sources familiar with the matter. The offering could value the business in excess of $25 billion, making it one of the biggest IPOs ever for a technology company.
The China-based streaming-music service already met with its underwriting team this week to discuss the price range for its IPO, but they decided to wait several weeks on worries that the recent market sell-off could weigh on the pricing, The WSJ added.
US market have been hit hard in recent days, with the S&P 500 declining more than 6% so far in October as concerns about rising interest rates and trade tensions weigh. The Dow Jones industrial average shed more than 1,300 points over the last two trading sessions.
And the carnage isn't just limited to the US. China's markets are among the hardest hit, with the benchmark Shanghai Composite, down more than 20% this year and at the lowest level in four years. Tencent Music's parent company, Tencent Holdings, has dropped more than 20% since releasing its quarterly results on August 15, and has seen $200 billion of market cap wiped out since February.
Tencent Music operates several popular music brands in China - including QQ Music, Kugou, Kuwo and WeSing - and had more than 800 million unique monthly active users in the second quarter of 2018, according to a public filing.
For the year ended December 31, 2017, Tencent Music said it earned RMB1.32 billion ($199 million) on revenue of of RMB10.99 billion ($1.66 billion).
The company also said it generated a profit of RMB2.11 billion ($320 million) in the first half of this year, almost three times as much as its RMB732 million profit during the same period in 2017.
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