Tuesday Tech Briefing: Tencent Music Launches Billion-Dollar U.S. IPO

1. China's Tencent Music Launches US IPO With Valuation of Up to $24.5 Billion

Tencent Music Entertainment, a major online music platform in China, filed for an initial public offering (IPO) of up to $1.23 billion with the U.S. Securities and Exchange Commission on Monday, with a valuation of $21.2 billion to $24.5 billion.

Tencent Music owns streaming apps QQ Music, Kugou, and Kuwo and karaoke app WeSing, with over 800 million total monthly active users as of the third quarter of this year.

The platform reported a profit of $394 million in the first nine months of this year, a 245% increase from $114 million in the same period in 2017, according to the prospectus. (Caixin, link in Chinese)

2. TD Ameritrade Becomes First U.S. Brokerage to Partner with Tencent's WeChat in America

TD Ameritrade is partnering with Tencent as the U.S. brokerage firm looks to tap the massive user base of the Chinese technology company's WeChat messaging app, CNBC reports. The online brokerage announced Monday it's opening a portal on WeChat for U.S. users, following a similar launch in August for Hong Kong users.

WeChat boasts more than 1 billion monthly active users. The latest move doesn't get TD Ameritrade into the Chinese mainland yet, but would allow U.S. users to use the portal to check market data and other features, which gives the company a first-mover advantage.

The online brokerage's push to work with a major Chinese brand comes as Beijing steps up its efforts this year to make good on years-long promises to open up its financial markets to foreign players. (CNBC)

3. Qualcomm Rules Out Renewed NXP Bid After China Opens Door

Qualcomm Inc. ruled out any chance of revisiting an abandoned bid for NXP Semiconductors NV after U.S. and Chinese political leaders appeared to open the way for possible approval of the transaction.

“While we were grateful to learn of President Trump and President Xi’s comments about Qualcomm’s previously proposed acquisition of NXP, the deadline for that transaction has expired, which terminated the contemplated deal,” the company said in an emailed statement. “Qualcomm considers the matter closed and is fully focused on continuing to execute on its 5G roadmap.”

The statement came as a response to a US-China trade truce over the weekend, when the White House said President Xi Jinping said he would consider approving a possible deal for Qualcomm to purchase NXP if it’s brought to him again. (Bloomberg)

4. Even Hackers Accept WeChat Pay Now

It seems that everyone in China is accepting WeChat payments these days, from street vendors to fast-fashion brands – and now, even malicious software designers.

At least 20,000 computers in China have been affected by a ransomware virus that only accepts payment via WeChat Pay, the semi-official China News Service reported Tuesday.

The virus encrypts stored files and accesses passwords to popular sites like Taobao and email provider 163, then demands a payment of 110 yuan ($16) in order for users to get their data back. (China News Service, Caixin)

5. Chinese Audiences Less Than Crazy About Rom-Com Rich in Asians

Hollywood blockbuster “Crazy Rich Asians” has failed to wow audiences on its opening weekend in China, when it was beaten by a 2016 shoot'em-up in which Mel Gibson takes on a Mexican drug cartel.

The rom-com raked in 8 million yuan ($1.1 million) in its first three days through Sunday, according to data from Chinese box office tracker Maoyan. The Gibson film, “Blood Father,” took 11.3 million yuan in receipts.

Chinese critics had earlier cast doubt over whether the rom-com’s depiction of the immense wealth of a group of ethnic Chinese would sit well with Chinese regulators that promote “core socialist values” — but it surprised many when it breezed through the vetting process for a Nov. 30 release. China is currently running neck-and-neck with North America to become the world’s top box office market. (Caixin)

6. Used-Car Platform Fined $1.8 Million for False Advertising

Used-car trading platform Guazi has been fined 12.5 million yuan ($1.8 million) for misleading consumers.

The Beijing commerce bureau found that the site, which connects individual buyers and sellers, had overstated its business when it advertised claim that “one year after its creation, the trading volume on our used-car platform has risen to the top.”

However, the bureau found that Guazi, which went online in 2015, only sold 86,000 vehicles during the one-year period from August 2015 to July 2016, whereas two major rivals sold 400,000 and 90,000 units in the same period. Guazi said in a statement on Friday that it disputed the bureau’s ruling and has filed for a review of the matter. (Caixin)

Compiled by Isabelle Li