Tencent in talks with Vivendi to buy 10% stake in Universal Music

UMG has a 30% market share, and artists like Taylor Swift and Lady Gaga on its books

Chinese digital giant Tencent is seeking to snap up a minority stake in Universal Music Group (UMG) after reportedly entering into talks with owner Vivendi to acquire a 10% slice of the business.

Vivendi – which also owns advertising giant Havas – says it has entered negotiations over a possible sale which would value the business at €30bn, with a further one-year option to acquire a further 10% share on the same terms.

UMG is currently the world’s largest music company with a market share of over 30% in 2018 and artists like Taylor Swift and Lady Gaga on its books. The label said it is exploring means of attaining further growth via "strategic commercial cooperation" with Tencent.

UMG chief executive Lucian Grainge added: “Obviously we remain part of the Vivendi family – today’s announcement is about a minority investment by Tencent. I can assure you that Vivendi’s supervisory and management boards as well as the Bollore family continue to be steadfast supporters of our strategy, our work and our teams.”

Universal Music’s growth has helped offset a weaker performance at Vivendi’s other businesses and a deal with Tencent could open up further revenue streams in the lucrative Chinese market.

The French media conglomerate's other properties include TV network Canal+.

When it acquired Havas for €2.36bn in 2017, questions were raised about whether it could remain an impartial intermediary, owing to its already heavy media portfolio.

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