Tencent music guides pricing around midpoint in $1.2bn IPO

(Photo: Richard A Brooks, AFP)
(Photo: Richard A Brooks, AFP)

Tencent Music Entertainment, China’s largest music-streaming service, is guiding potential investors that it could price its $1.2bn US initial public offering around the midpoint of a marketed range.

Subscribe to Fin24’s newsletter here

The company sees price sensitivity in the middle of the range based on current orders, according to a message communicated to fund managers on Tuesday. The final price hasn’t been set yet and the pricing level is subject to change.

Tencent Music will stop taking orders from Asian investors at the end of business on Tuesday and at noon New York time for US institutions, the message shows. The company and existing investors are marketing 82 million American depository shares at $13 to $15 each.

Chinese companies have raised $8bn from first-time share sales in the US this year, more than double the same period in 2017, data compiled by Bloomberg show. It’s the biggest year for mainland firms since 2014, when Alibaba priced the world’s largest IPO, the data show.

Tencent Music is slated to price its offering after the December 11 market close, according to terms for the deal obtained by Bloomberg earlier. Morgan Stanley, Goldman Sachs, JPMorgan Chase & Co, Deutsche Bank and Bank of America are among underwriters of the offering. The company declined to comment.

Net income at Tencent Music more than tripled in the first nine months of the year to $394m, according to an exchange filing. Revenue for the period nearly doubled to about $2bn. Its major shareholders include Tencent, which owns 59%, and music-streaming service Spotify Technology SA, with 8.9%, the filing shows. 

* Fin24's parent company Media24 is part of the Naspers Group. Naspers owns a stake in Tencent

ZAR/USD
17.00
(-0.09)
ZAR/GBP
21.24
(-0.12)
ZAR/EUR
19.14
(-0.13)
ZAR/AUD
11.81
(-0.13)
ZAR/JPY
0.16
(-0.20)
Gold
1774.74
(+0.03)
Silver
18.05
(+0.01)
Platinum
808.00
(+0.25)
Brent Crude
42.78
(-0.79)
Palladium
1914.01
(+0.62)
All Share
54521.90
(-0.17)
Top 40
50179.89
(-0.26)
Financial 15
10150.02
(-0.64)
Industrial 25
76554.73
(+0.52)
Resource 10
50138.02
(-1.24)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
I'm not really directly affected
18% - 1590 votes
I am taking a hit, but should be able to recover in the next year
23% - 2079 votes
My finances have been devastated
34% - 3111 votes
It's still too early to know what the full effect will be
25% - 2250 votes
Vote