The deal, valued at $2.4 billion in cash and stock, aims to strengthen Tencent’s position in China’s podcasting and audio content market.

Tencent Music Entertainment Group (TME) has unveiled plans to acquire Chinese audio content platform Ximalaya Inc., in a strategic deal aimed at expanding its footprint in the spoken-word and podcasting segment of China’s digital media industry.

The cash-and-stock deal, according to a Reuters report, is valued at approximately $2.4 billion.

In addition to $1.26 billion in cash payments, Tencent Music will issue Class A ordinary shares representing no more than 5.1986% of its total share count, calculated based on figures available within five business days of closing. 

Another tranche of up to 0.37% of Tencent Music’s outstanding Class A shares may be distributed to Ximalaya’s founding shareholders post-closing, subject to agreed conditions.

The agreement, announced on Tuesday, outlines the conditions under which Ximalaya will become a wholly-owned subsidiary of Tencent Music, pending regulatory approval.

Ximalaya, widely regarded as a major player in China’s online audio content space, will undergo corporate restructuring as part of the merger process. 

Tencent Music, which operates several popular music and karaoke apps including QQ Music, Kugou, and Kuwo, is looking to extend its presence in the digital entertainment market by embracing podcasting and long-form audio. 

The acquisition of Ximalaya provides a direct pathway into the booming vertical, mirroring moves by global peers to diversify beyond traditional music streaming.

News of the acquisition sent the NYSE listed Tencent Music’s shares up more than 2% in U.S. morning trading, reflecting investor confidence in the company’s shift toward high-engagement, content-driven platforms. 

On Stocktwits, retail sentiment around Tencent Music changed to ‘bullish’ from ‘bearish’ the previous day.

TME's Sentiment Meter and Message Volume as of 10:00 a.m. ET on Jun.10, 2025 | Source: Stocktwits

A Stocktwits user believes the shares are underrated.

Tencent Music stock has gained over 66% year-to-date and over 32% in the last 12 months.

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