Tencent is solidifying its relationship with leading music corporation Universal Music Group as it maintains a leading position within the Chinese music streaming landscape.

A group of investors headed by Tencent, including Tencent Music Entertainment – Tencent’s dedicated music platform – is preparing to acquire an additional 10% ownership share in UMG from the French media company Vivendi SA, according to a statement released by TME on Friday.

This investment establishes a valuation of €30 billion, equivalent to $36.8 billion, for UMG and will elevate the consortium’s total ownership in the music company to 20%. TME maintains a 10% equity position within the consortium, with the identities of other participating members remaining undisclosed.

“This deal highlights TME’s dedication to bolstering its strategic alliance with UMG. TME anticipates continued and expanded cooperation with UMG as they jointly strive to deliver exceptional services and products to both artists and music enthusiasts in China’s rapidly growing music entertainment sector,” the company stated.

The completion of this transaction is anticipated during the first six months of 2021, contingent upon receiving the necessary regulatory clearances, as TME indicated.

Previously, in August, TME and UMG announced the creation of a collaborative label focused on identifying, nurturing, and promoting Chinese musical talent both within China and internationally.

Tencent has established strong connections with all of the major music labels, securing licensing agreements for content used within its music-centered applications. Both Warner Music and Sony Music Entertainment invested in TME when it became a publicly traded company in Hong Kong.

Documents filed with the SEC by Warner Music earlier this year revealed that it had divested a minor stake to Tencent. It is also worth noting that Tencent previously entered into an agreement with Spotify in 2017, involving a reciprocal exchange of ownership stakes.