Tencent to take 10 per cent stake in Universal Music

Tencent is to take a 10 per cent stake in Universal Music, which represents, artists from The Beatles to Taylor Swift, making their attempt to broaden its reach in the global music industry.

French Media Conglomerate Vivendi Universal’s owner said  it was in talks to sell the stake to Tencent in a deal that would value the world’s largest music group at €30bn. Tencent will have an option to double its stake within a year on the same terms.

The latest move is part of a recovery from a 15-year slump driven by online piracy and the collapse of the CD market.

Tencent also holds substantial minority stake in April’s direct listing of Spotify.

Tencent is also a heavy backer of music services worldwide –including India’s Gaana, pan-Asian service Joox and singing app Smule – the move to buy into record label signals a substantial change in strategy towards content rather than technology.

Lucian Grainge, the Universal CEO, who led the talks with Vincent Bollore, Vivendi’s billionaire president, stressed the deal would not disrupt the music company’s  strategy saying “ We remain part of the Vivendi family”.