Warner Music to go public June 3

Carla Harmon
May 27, 2020

Warner Music Group said on Tuesday it expects to raise up to $1.82 billion in its Nasdaq debut at a valuation of about $13 billion, as some companies gingerly test investor appetite after the COVID-19 pandemic put many debuts on hold.

The underwriters will have a 30-day option to purchase up to an additional 10,500,000 shares of Class A common stock from the selling stockholders.

Warner Music said existing shareholders would sell 70 million shares priced at $23-$26 apiece. The pondering behind Warner's transfer is probably going that the corporate is seeking to launch the IPO earlier than the market feels the complete impact of the pandemic. The company's debt totals US$2.98-billion. Growth in streaming servies has boosted the value of music companies in recent years.

Warner Music's multi-billionaire founder, Len Blavatnik, made his fortune in Russian oil before entering the music and entertainment industry.

The home of Asylum, Atlantic Records, Parlophone, Elektra Warner Records and Warner Classics, among others, and artists including Cardi B, Ed Sheeran and Bruno Mars, Warner Music had previously filed to list on the Nasdaq market under the ticker symbol WMG.

Warner Music Group Corp. reignited its plans for an initial public offering, becoming the latest music company to cash in on a streaming boom that's only accelerated in the coronavirus era.

Blavatnik, a Ukrainian American who has a net worth estimated at $22.9 billion, according to the Bloomberg Billionaires Index, bought Warner Music for $1.3 billion in 2011. The company also owns music publisher Warner Chappell. Its music publishing business generated $643 million. While Universal Music Group was recently valued at a whopping $33 billion - as part of its agreement to sell 10% of itself to a consortium led by Chinese tech giant Tencent - like most businesses the music industry has been hit hard by the coronavirus pandemic: Consequently, a Goldman Sachs report released earlier this month projects a 25% drop in global music revenue in 2020.

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