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UMG IPO SET FOR '22

A Universal Music Group IPO will take place in 2022, Vivendi announced Tuesday. UMG continues to be the jewel in the crown of the French company, as revenue rose 5.1% for the first nine months of 2020 and was up 3% in the third quarter, to $2.2b.

Vivendi announced Tuesday that UMG's subscription and streaming revenues were up nearly 16%, to $3.32b, for the first nine months of 2020 and that music publishing revenue grew by 15.6%. Streaming revenue for the third quarter was up 22.6%, to 1.16b.

The impact of the COVID-19 pandemic was felt at merchandising, which is down 42.6% for the first nine months. Physical sales were down 10.2% compared to the first nine months of 2019, while download sales declined by 20.1%.

Tencent, which owns 10% of UMG, intends to buy another 10% before its option expires in January. Vivendi plans to use the cash from Tencent and the IPO to reduce its financial debt and finance a significant share-buyback program as well as acquisitions.

In a conference call with investors and analysts, Vivendi CEO Arnaud de Puyfontaine said the company is pleased with streaming and physical sales but noted it's difficult "to be precise" in predicting the fourth quarter in music.

He did say UMG will "continue to be opportunistic [sic] through investments in artists and catalogs."

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