Tencent is said to be looking to spin off its music business - Tencent Music Entertainment - and list it on the New York Stock Exchange. This would be a major blow to the Hong Kong Stock Exchange, which is looking to gain more tech stocks and even recently picked up Xiaomi who debuted on the exchange today. Tencent's Music Entertainment is the biggest music provider in China right now, and having it go public would hint at the fact that the music industry is making a comeback. Spotify went public earlier this year, with a rather successful direct listing onto the New York Stock Exchange. Spotify owns about 7.5-percent of Tencent Music Entertainment, while Tencent owns about 9-percent of Spotify.
In a filing it made on Sunday, Tencent Music is looking to get an initial public offering worth around $4 billion, and it is valuing the business at about $25 billion. Tencent also stated that the terms of the spin-off, including size, and entitlement of the company's current shareholders have not been finalized. but further statements will be added in the near future. Having Tencent's music arm list on the US stock market would be a rather interesting move for Tencent, but it wouldn't be the first to do this. Alibaba has done the same thing with various business units within its own company.
In the past few months, a number of businesses from China have launched on the New York Stock Exchange and have done fairly well, with a number of them being up over 50% since their IPO date - some of which are only a couple of weeks old at this point. Despite the proposed trade war between the US and China, these Chinese-based stocks are still doing quite well for investors. It'll be interesting to see if Tencent Music Entertainment's listing is similar, when it does finally happen.