Spotify Gets a Boost as Tencent Music Kicks Off Share Sale
(Bloomberg) -- Music-streaming service Spotify Technology SA saw its market value jump $779 million as China's Tencent Music Entertainment Group kicked off its long-awaited U.S. initial public offering.
Spotify owns 8.9 percent of the company, whose largest shareholder is Tencent Holdings Ltd. with 59 percent, according to its IPO filing Monday. Spotify closed up 3.2 percent to $140.68 a share on the same day, giving it a market value of $25.5 billion.
Monday's boost helped lift Spotify further out of its November slump, when shares fell below their $132 reference price set before it went public in April.
China's largest music-streaming service and investors are offering 82 million American depositary shares at $13 to $15 each, which would raise as much as $1.23 billion, Monday's filing shows. The top end of the range implies a market value of $24.5 billion.
The deal is expected to price Dec. 11 after market close, according to terms for the deal obtained by Bloomberg.
Tencent Music's net income for the first nine months of the year more than tripled to $394 million as revenue nearly doubled to about $2 billion, the filing shows.
Stockholm-based Spotify acquired a minority stake in Tencent Music last December, according to data compiled by Bloomberg.
--With assistance from Fox Hu.
To contact the reporter on this story: Michael Hytha in San Francisco at mhytha@bloomberg.net
To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net, Ben Scent, Timothy Sifert
©2018 Bloomberg L.P.
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