China Music Offers Tencent Holdings Controlling Stake in their Company
Tencent Holdings agreed to acquire a controlling stake in China Music Corp. a deal that some say is valued ar $2.7 billion. The internet giant the boosts its stake in the country’s leading music streaming company that owns Kuwo and Kugou with 16 and 60 percent respectively. Tencent is China’s largest social networking and online gaming firm, that runs its own online music service QQ music and is planning to combine the two entities to create one dominant player in the music industry market.
Sources say that by combining the two music businesses is valued at $6 billion once the deal is completed and will operates as a subsidiary of Tencent. Kugou is one of the largest mobile music service with a 28 percent market share in China which is followed by QQ Music by 15 percent and Kuwo’s 13 percent. China Music Corp. is planning an initial public offering in the US that has been placed on hold for some time, but Tencent might also pursue an initial public offering of the company once it its combined in the future.
Several reports have showed Tencent is securing deals with Sony Music Entertainment and Warner Music to be their exclusive online distributor in China. The country tops the world by the number of mobile users having 449 million users in jus the first quarter that is more than the entire population if the US.