What do Drake, Taylor Swift, and the Beatles have in common? Don't worry, it's not the start of a corny joke! Other than being icons in their music genres — starting Tuesday, they'll have their official debut on the stock exchange. Or rather, the music company behind them will. Vivendi's Universal Music Group (UMG) is ready to list on Euronext with a valuation of Є33b and an Є18 price per share.
This move comes after Vivendi sold a 20% stake of UMG to Tencent last year. Going public is another way for Vivendi to reduce its stake in the music industry and focus on television instead. After the listing, Vivendi will end up holding only a 10% stake in the company. UMG's listing will also test the public's appetite for music as an asset class. We may soon start to look at music just as another investment in our portfolio, considering its risks and opportunities, as we would do with any other stock.
Why it matters
UMG's listing will be an unprecedented opportunity for the general public to "own" part of the music industry. Currently, UMG's competitor Sony Music is not independently listed, and Warner Music Group offered less than 15% of its shares (with the rest held by the owner Len Blavatnik).
