<article>Tencent-affiliated China Music Corp. (CMC), which backs Chinese online music services Kugou and Kuwo, is targeting to conduct an initial public offering (IPO) in the US before the end of 2016 on the NASDAQ.</article>

Tencent-affiliated China Music Corp. (CMC), which backs Chinese online music services Kugou and Kuwo, is targeting to conduct an initial public offering (IPO) in the US before the end of 2016 on the NASDAQ.
According to an article on Wall Street Journal, which first <a style="color: #000080" href="http://www.wsj.com/articles/tencent-backed-music-streaming-service-plans-u-s-ipo-1462967987" target="_blank">reported</a> this development, CMC engaged Goldman Sachs Group and Morgan Stanley for the IPO. It is estimated that the IPO will raise $300-$600 million in capital for CMC.
With most Chinese consumers listening to music via smartphone apps, CMC is aiming to secure its position in a growing market.
Two of the tap mobile music apps, Kugou and Kuwo, are owned by CMC, while firms like Tencent, Alibaba Group and Baidu compete against CMC with their own <a class="icon none" style="color: #000080" href="http://blogs.wsj.com/digits/2015/06/09/qa-how-tencent-plans-to-get-chinese-consumers-to-pay-for-music/" target="_blank">music-streaming businesses</a>.
Beijing&#8217;s securities regulators are <a style="color: #000080" href="http://www.scmp.com/business/article/1942060/door-closing-chinas-back-door-listings-it-wont-be-slammed-shut" target="_blank">clamping down on backdoor listings</a>, with a backlog in China&#8217;s IPO pipeline. This has made a US listing more appealing. Besides, the US market is more welcoming to smaller IPOs compared to the Hong Kong bourse where investors prefer larger IPOs. This is primarily on account of the difference in fee structures, with Wall Street banks receiving 7 per cent of IPO proceeds compared to 2 per cent or less in Hong Kong and Shanghai.
January 2016 saw CMC enter a syndication deal with QQ Music, Tencent&#8217;s music streaming service, which permits its companies the rights to more than one billion songs exclusively distributed by QQ Music within China. This comes as Beijing <a style="color: #000080" href="http://techcrunch.com/2015/11/09/china-cracks-down-on-internet-music-services/" target="_blank">enforces censorship measures on music services</a> and seeks to control online music piracy.  This has led to major players taking steps to minimise piracy on their platforms, even as the various parties engage in legal battles over music infringements.
According to TechNode, CMC, through Kugou and Kuwo, dominate  China&#8217;s online music streaming industry thanks to their presence in the country&#8217;s third and fourth-tier cities, considered an under-served market.
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China Music Corp is planning to list on the NASDAQ in an IPO that could raise between US$300 million to $600 million.

Tencent-affiliated China Music Corp plans Nasdaq IPO, eyes proceeds up to $600m

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Tencent-affiliated China Music Corp plans Nasdaq IPO, eyes proceeds up to $600m

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