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China's biggest music-streaming firm, Tencent Music Entertainment Group, is gearing up for what would be the largest technology initial public offerings after the successful market debut of its European counterpart, Spotify Technology SA.
The digital-music unit of China's internet giant Tencent Holdings Ltd. is planning to scout potential underwriting banks over the course of next month, people privy to the matter said.
The IPO, which could be launched in the second half of the year, would one of the biggest deals of the year and is anticipated to raise billions in proceeds, according to sources. Tencent Music is anticipated to list in the U.S. stock markets, but it is unlikely to finalize its decision on a venue for several months, some of the people familiar to the proceedings said.
The offering could value the business at over $25 billion, sources stated. This was the firm's declared value in recent private transactions, according to a Wall Street Journal report last month. The figures are a sharp jump from its $12.5 billion valuation last last year when Spotify acquired a 9 percent stake in the firm under a share swap.
If investors designate the said figures in its IPO pricing, it would be the fourth-biggest U.S.-listed tech IPO on record, gauged by valuation at the time of the IPO, Dealogic said.
But there is still no guarantee that the firm will push on with a share offering in New York or in other location, and pre-IPO valuations could change until a firm sets a price on its shares.
Investors are anticipating Tencent Music's OPO due to its connection to Tencent Holdings, which has a stake of over 50 percent in Tencent Music, as well as its dominant position in the marketplace.
