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Tencent Music to Acquire Ximalaya in USD 2.4 Billion Deal to Expand Audio Content Reach

  • tech360.tv
  • 49 minutes ago
  • 2 min read

Tencent Music Entertainment Group will acquire audio platform Ximalaya in a deal valued at approximately USD 2.4 billion, the company announced Tuesday.


Bold, stylized blue logo featuring overlapping letters "TME" on a white background. The font is geometric and modern.
Credit: UMG

The transaction includes USD 1.26 billion in cash and up to 5.2% of Tencent Music’s class A ordinary shares. An additional 0.37% of shares will be issued to Ximalaya’s founding investors.


Mobile app interface with a list of audiobook covers, featuring text in Chinese. Red and orange accents highlight app features and categories.
Credit: XIMALAYA

Ximalaya, which offers podcasts, audiobooks, radio programmes and music, confirmed the merger and said it will retain its brand, operational autonomy, core management team and strategic direction. The company also pledged to honour existing contracts and protect user rights.


The acquisition is subject to regulatory approvals, including antitrust reviews. Ximalaya will restructure certain existing businesses as part of the deal.


Shares of Tencent Music rose as much as 7% in pre-market trading in New York. Its Hong Kong-listed shares closed up 2.4% on Tuesday before the announcement.


Founded in 2012, Ximalaya has attempted multiple public listings, including a 2021 US IPO filing and three applications to the Hong Kong stock exchange, all of which were later withdrawn.


According to its April 2024 prospectus, Ximalaya reported annual revenue of CNY 6.16 billion (USD 857 million) and net income of CNY 224 million for 2023. The platform had 302 million average monthly active users and was profitable for five consecutive quarters through the end of 2023.


Tencent Music, a subsidiary of Tencent Holdings, is China’s largest online music platform by user count. In the first quarter, it reported an 8.7% year-on-year revenue increase to CNY 7.36 billion and net profit of CNY 4.39 billion. However, monthly active users across its QQ Music, Kugou and Kuwo platforms fell 4% to 555 million.


Tencent Music generates revenue from music subscriptions, advertising, artist merchandise, offline performances and social entertainment services such as live streaming.


China’s audio content market is increasingly competitive, with rivals including Sound Group, Qingting FM, NetEase Music, China Literature, IReader Technology, ByteDance’s Tomato Novel, WeChat’s reading app and podcast platform Xiaoyuzhou.

  • Tencent Music to acquire Ximalaya for USD 2.4 billion in cash and stock

  • Ximalaya to retain brand and management, pending regulatory approval

  • Ximalaya had 302 million monthly active users and USD 857 million in 2023 revenue


Source: SCMP

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