China’s largest music streaming service Tencent Music has filed to go public in the US, a widely-anticipated move which could see it valued at $30bn (£23bn).
The service is currently part of Chinese giant Tencent, but is being spun out of the larger gaming and social media company.
It said its initial target was to raise $1bn, although this is considered a placeholder amount and some are expecting it to raise double that figure.
This could give it a valuation of anywhere between $25bn and $30bn, putting it in line to become one of the largest tech flotations in recent years. Rival streaming service Spotify, which is also an investor in Tencent Music, landed a similar valuation in its own market debut earlier this year.
Unlike Spotify, however, Tencent Music is profitable, making around $260m in profit in the first half of 2018 on revenue of $1.3bn. More than two-thirds of its revenue came from so-called “social entertainment services”, which include live streaming and online karaoke, and it has around 800 million unique users.
The company, in its filing last night, said it expected the number of people who pay for music in China to “more than quadruple between 2017 and 2023”.
Tencent Music did not reveal whether it would be listing on the New York Stock Exchange or Nasdaq.
Its decision to go public comes after a flurry of recent IPOs by Chinese companies, coming just weeks after electric car maker NIO joined the New York Stock Exchange. The company, which was backed by Tencent Holdings, landed a valuation of $6.4bn, well below the $20bn it had initially been hoping for.
However, Meituan Dianping, a food delivery company, had a more positive debut, pricing its IPO at the top of its target range and receiving a valuation of around $53bn.