Tencent Music Entertainment executives celebrate the company’s IPO in front of the New York Stock Exchange (NYSE) on December 12, 2018 in New York, USA
Bryan R Smith | Reuters
GUANGZHOU, China – Tencent Music Entertainment Group announced plans to buy back shares valued at up to $ 1 billion on Monday after US-listed stocks suffered a huge drop last week.
Buybacks can begin on Monday and will take place over the next 12 months.
Tencent Music is the online music arm of Chinese tech giant Tencent that runs streaming services and apps. Listed on the New York Stock Exchange, the company lost about a third of its value last week due to a sell-off of Chinese technology stocks.
Part of that sale came after the US Securities and Exchange Commission passed law that could result in the delisting of foreign companies that violate the new audit rules.
However, further pressure came on Friday after Archegos Capital Management was forced to liquidate positions in some major Chinese tech names, CNBC reported.
Tencent Music will buy back Class A common shares in the form of American depository shares, it said in a statement.
“The share buyback program is a strong indication of the Board of Directors’ confidence in the company’s business prospects and long-term strategy. We believe it will ultimately benefit TME (Tencent Music Entertainment) and create value for its shareholders,” said Tong Tao Sang, Chairman of the board said.