Tencent Music Entertainment Group, the subsidiary of Chinese tech conglomerate Tencent Holdings Ltd. (HKEX: 0700), jumped as much as 13 percent to $14.75 per share when it debut for trading Wednesday. The company raised $1.1 billion after pricing its shares at the bottom of its targeted range of $13 to $15 apiece.
The company initially planned to launch the deal in October, but given a recent plunge in global markets and the tension between U.S. and China, the company decided to postpone the IPO.
Shares rose more than 9 percent to $14.20 apiece at 1:45 p.m. in New York, valuing the company at about $23.25 billion -- just below the market valuation of Spotify Technology SA, its dominant counterpart in the U.S. Spotify is also one of the key investors of Tencent Music. According to Spotify's SEC filing in February, the Swedish company said it held 8.5 million shares of Tencent Music (around 9 percent), valued at $1.07 billion at the time.
Tencent Music was formed in 2016 when its parent purchased China Music Corp., the owner of Kugou and Kuwo, for $2.7 billion. China Music subsequently merged with QQ Music, a music platform Tencent launched in 2003. WeSing, Tencent's online social karaoke platform, began operating in 2014.
The company's mission, as its prospectus states, is "to use technology to elevate the role of music in people's lives, by enabling them to create, enjoy, share and interact with music."
The company reported a 244 percent profit jump for January-September to $394 million. By comparison, Spotify, its dominant counterpart in the U.S., lost a net $520 million.
Morgan Stanley, Bank of America, Deutsche Bank, Goldman Sachs and JPMorgan were listed as the lead sponsors of Tencent Music's deal.
Tencent Music will be traded under the symbol "TME."
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