TME and Spotify will acquire new shares representing minority equity stakes in each other for cash. In addition, Tencent will invest in Spotify through secondary purchases. Following these transactions, Spotify will hold a minority stake in TME, and both Tencent and TME will hold minority stakes in Spotify.
Spotify operates the world’s largest music streaming service. Tencent, which owns a majority stake in TME, operates the most popular social platforms in China and has a proven record of investing in innovative technology companies. TME is an early mover in authorized digital music and is the largest online music services company in China. It provides a rich catalogue of digital music services including streaming, online live broadcasts and karaoke, serving hundreds of millions of users.
Daniel Ek, CEO and Founder, Spotify, said, “Spotify and Tencent Music Entertainment see significant opportunities in the global music streaming market for all our users, artists, music and business partners. This transaction will allow both companies to benefit from the global growth of music streaming.”
Cussion Pang, CEO of TME, said: “We are excited to embark on this partnership with the largest music streaming platform in the world. TME and Spotify will work together to explore collaboration opportunities, with a common objective to foster a vibrant music ecosystem that benefits users, artists and content owners.”
Martin Lau, President at Tencent, said: “We are delighted to facilitate this strategic collaboration between the two largest digital music platforms in the world. Both of us share the same commitment to bringing music and superior entertainment experiences to music lovers, and to expanding the global digital music market for artists and content partners.”
This press release contains forward-looking statements. Such statements are subject to known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Spotify or TME or Tencent to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Due to these risks and other uncertainties, investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Neither Spotify nor TME nor Tencent undertakes to update, alter or otherwise revise the forward-looking statements contained in this press release to reflect events or circumstances occurring after the date hereof.