SHENZHEN, China — – Tencent Music Entertainment Group the leading innovative online music entertainment platform in China — shares are up 21.6% Monday morning after its acquisition of Lazy Audio, a Chinese-owned service with spoken word content such as audiobooks and podcasts, for RMB 2.7 billion ($417 million).
“We are delighted to welcome the talented Lazy Audio team to the TME family, and expect this strategic acquisition to significantly deepen our presence in the fast growing long-form audio industry in China,” said Mr. Cussion Pang, Chief Executive Officer of Tencent Music. “As a leading provider of audio entertainment, Lazy Audio can be seamlessly integrated into our existing long-form audio strategy, enabling us to further monetize the extensive library of high-quality literature IPs that we have access to through strategic partnerships with China Literature and others.”
The stock ended Tuesday at $26.86, another high closing price in a 88.4% upswing since Oct. 13. Tencent owns China’s most popular music streaming apps — QQ Music, Kogou Music and Kuwu Music — and the karaoke app WeSing. It was spun off from Chinese tech giant Tencent Corp. in December 2018, raising $1.1 billion in an IPO on the New York Stock Exchange.
Tenecent entered into a definitive agreement to acquire 100% equity interest of Shenzhen Lanren Online Technology Co, Ltd.
Lazy Audio was founded in 2012. The existing shareholders of Lazy Audio include China Literature Limited (“China Literature”, stock code: 00772.HK), Lazy Audio’s management team and other financial investors. The transaction is expected to close in the first half of 2021 subject to customary closing conditions.
“Lazy Audio’s catalog is set to expand our audio content library, and its recording capacity will significantly boost our production of audiobooks. We believe this partnership will help us cater to the increasingly nuanced needs of our customers, strengthen our brand recognition in this segment, generate considerable operational synergies, and accelerate our journey to become a leading audio entertainment platform in China.” Mr. Pang added.
Mr. Bin Song, founder and Chief Executive Officer of Lazy Audio, said, “We share the same vision with TME that China’s audio industry is a less-penetrated area with great potential. Merging with TME will benefit us to strengthen our competitiveness, establish a stronger connection with Tencent portfolio and bring Lazy Audio to the next level.”
Lazy Audio will maintain its independent operations while being an essential component of TME’s overall long-form audio strategy. Upon completion of acquisition, TME will consolidate the investment in Lazy Audio, and enable Lazy Audio to have full access to TME’s expertise, leading technology, and strong promotional capabilities.
Reported by Woodlawn Post Technology