The tech stock slump that has investors shifting money from former sure-things like Apple and Amazon and into assets like power companies and bleach, appears to have spooked one of Wall Street's biggest new entrants. Reuters is reporting that China-based Tencent Music Entertainment and its advisers are in talks to push its $2 billion IPO into 2019, rather than face a tech-weary market.
TME's parent company, Tencent Holdings, had already delayed the IPO from a tentatively planned October rollout and into November. With tech stocks still week, coupled with December being a traditionally slower month on Wall Street, especially for IPOs, the company may be open to waiting until the new year.
According to financial data company Refinitiv, Wall Street has hosted only three IPOs worth more than $1 billion in December over the past decade.
Reuters sources say they'll "continue to monitor" market conditions before making the decision, and that "what they care about a lot is (getting) the right valuation, rather than the fast pace of the listing."
Tencent Music currently runs the four top mobile music apps in China by monthly active users, namely QQ Music, Kugou Music, Kuwo Music and WeSing. Combined, the four services have over 800 million monthly active users, according to the parent company’s F-1 filing announcing the IPO. Tencent Holdings has a 58 percent stake in TME, while Spotify took 9.1 percent following a stock swap late last year. The IPO filing also revealed that Warner Music and Sony Music purchased a total of 68,131,015 ordinary shares in TME, worth approximately $200 million.