BANGKOK – Stock price of GMM GRAMMY, one of the most comprehensive music businesses in Thailand, soars to the ceiling +30.17% on Tuesday after securing a deal with Tencent.
GMM Grammy’s stock price hit the ceiling at 7.50 baht per share, increasing by 1.75 baht or +30.17% on June 4, 2024, compared to the previous day’s price. This comes after GRAMMY notified the stock exchange on May 31 that it had sold a 10% stake in GMM Music to the Tencent group, a giant technology company from China, for 2,570 million baht. The total valuation of GMM Grammy could be estimated as 25,700 million baht.
This deal aims to extend the Spin-off plan to unlock the value of GMM Music and prepare for an IPO through business expansion, growth creation, artist development, and Know-how exchange between partner organizations, as well as expanding business opportunities to new markets, including China.
According to Prachachat Business, the deal between GRAMMY and Tencent involves GRAMMY selling 80 million shares, or a 10% stake, in “GMM Music” worth 2,570.82 million baht to Black Serenade Investment Limited, a company jointly established by Tencent Music Entertainment Group and Tencent Holdings Limited. Black Serenade is a subsidiary of Tencent Music Entertainment Group (the buyer group).
The buyer group will pay the compensation in cash and 30% of the total issued and paid-up ordinary shares of Joox Thailand (Hong Kong) Limited (Joox Thailand), a subsidiary of Tencent Music Entertainment Group (TME) that operates the JOOX online music streaming platform for users in Thailand.
GMM Tomorrow Limited, a wholly-owned subsidiary of the company, will receive 3 ordinary shares of Joox Thailand from the buyer group, representing a 30% stake in the total issued and paid-up ordinary shares of Joox Thailand, valued at 918.15 million baht.
The company expects the transactions of selling GMM Music’s ordinary shares and acquiring Joox Thailand’s ordinary shares to be completed within the second quarter of 2024. Black Serenade will become the second-largest shareholder of GMM Music, while GMM Tomorrow Limited will become the second-largest shareholder of Joox Thailand.
GMM Music is a comprehensive music business, from artist selection, music production, marketing, copyright management and collection, distribution of music products in both digital and physical formats, concert and festival organization, to artist management.
In 2023, GMM Music had a total revenue of 3,912.75 million baht and a net profit of 402.81 million baht. In Q1/2024, it had a total revenue of 950.52 million baht, a 7.7% increase year-on-year (YOY), and a net profit of 137.12 million baht, a 56.83% increase. Its total assets were 3,028 million baht.
Joox Thailand had a total revenue of 155.06 million baht in 2022, a net loss of 99.04 million baht, and total assets of 46.93 million baht (data as of April 1, 2024).
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