Universal Music has been signing the best popular artists for decades. With Taylor Swift in addition to Lady Gaga under contract (in addition to The Beatles back inwards the glory days), Universal are the biggest actor inwards the music industry.
Now, afterward long negotiations, its bring up companionship Vivendi have agreed to sell a ten% stake to the Chinese tech giant Tencent.
The 10% stake is valued at around €3bn, making Universal Music worth about €30bn as a whole. Tencent has as well been offered the opportunity to buy an additional x% by Jan 2021 at the same toll.
This deal could lead to global expansion for Tencent, which already owns a vii.v% stake inwards Spotify.
It appears that the society is aiming to assistance alongside the expansion of Universal Music inwards Asia. Parent fellowship Vivendi has expressed excitement over the bargain too believe it will give Universal Music a skilful chance to expand inwards the Asian market place.
This is bang-up intelligence for traders that deal with private stocks, every bit big changes inwards Universal could Pb to substantial profit inwards 2020.
Music Industry Revolution
Although many people like a shot believe that the music industry is becoming an industry to avoid since the introduction of illegal downloads together with the driblet inwards physical record sales in recent years, things are starting to alter.
Last yr, global music revenues showed a promising modify, growing at the fastest charge per unit nosotros’ve seen inwards 2 decades.
Sales were upwards 9.seven%, reaching £14.6bn inward 2018, the highest income that we’ve seen inward the music manufacture since the early on 2000s, where CDs made upward fourscore% of revenues globally.
There is no dubiety that the music manufacture is slowly taking a plow back from a rocky fourth dimension. Although it has taken virtually 20 years, the prove is suggesting that the industry is starting to choice up again since music became nearly alone digital.
With Tencent securing the Universal deal alongside their initial stake inward Spotify, traders should go on an middle on both Tencent in addition to Universal Music stocks inwards the coming twelvemonth.
2020 could provide the music industry alongside additional growth together with meet an increase inwards global revenues every bit streaming site subscriptions becoming increasingly popular.