After months of anticipation, China’s version of Spotify has finally made its U.S. stock market debut. Tencent Music Entertainment, the leading music-streaming service in China that was recently spun off as a separate arm by its parent company Tencent, opened on the New York Stock Exchange on Wednesday after raising about $1.1 billion on an initial share price of $13.
The company (trading under the ticker symbol “TME”) opened above its IPO price at $14.10 an American depositary share, and it says half of those shares will be sold by Tencent Music while the other half will be moved by existing shareholders. While Tencent Music had planned to launch its IPO in October, it pushed back the date amid broader market turmoil in China-U.S. trade tensions and U.S.-based tech stocks. Over the course of the day, shares gained about 10 percent to give the company a market cap of about $23 billion — comparable to that of Swedish competitor Spotify, which made its U.S. stock market debut in April this year. But Spotify’s shares have fallen about 20 percent since its first day of trading, meaning Wall Street will be closely watching Tencent Music’s performance.
Tencent Music has about 800 million monthly active users on its three streaming platforms — dwarfing Spotify’s 191 million — and its stateside public listing has been eyed with much interest because of what its success could indicate for the health of the global music industry. The company is majority-owned by Tencent, and Spotify has 9.1 percent following a stock swap between the two music companies in 2017. Warner and Sony have about $200 million in shares, according to a note in Tencent Music’s prospectus filed with the U.S. Securities and Exchange Commission earlier this year.
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