Vivendi has entered into preliminary negotiations with Chinese group Tencent to sell 10 percent of Universal Music Group (UMG), in a deal that would give UMG a preliminary equity valuation of EUR 30 billion. Tencent would also have a one-year call option to acquire an additional 10 percent stake at the same price and terms, said the company.
Vivendi’s plans for a stake sale were first unveiled just over a year ago, in July 2018. The company recently announced that several contacts had already been established with potential strategic partners, adding that it had selected the advisory banks for any future deal.
In its latest statement, Vivendi said that the process for the sale of another minority stake in UMG continues, without naming the potential buyers.
As part of the negotiations with Tencent, areas of commercial cooperation are also being explored, particularly to capture growth opportunities for UMG coming from the expansion in new markets. The two partners will look for example at improving the promotion of UMG’s artists and spotting new music talent.
