20 Dec 2017 | 11.00 am
DEGIRO: Broker Report
Spotify may skip its IPO, while 2017 is ending with a slew of big deals
20 Dec 2017 | 11.00 am
Paul Laverty (pictured), Head of Business Development Ireland with online broker DEGIRO, discusses major market stories for the next month
SPOTIFY SWAP Swedish streaming giant Spotify seems to be strategically positioning itself in the Asian online music industry. The firm recently announced that it will “explore collaboration opportunities” with China’s Tencent Holdings, or more specifically, its subsidiary Tencent Music Entertainment. The two companies will exchange a minority interest in one another, with reports suggesting this stake could be as high as 10%.
At the moment, Spotify is privately held. It raised several rounds of funding, the most recent of which was accumulating $526m in 2016. Talks of a public float have been ongoing for several years but rather than launch an IPO, it is now believed that Spotify will sign up for a direct listing.
Via this unusual method, the firm simply registers shares with an exchange and starts trading, without going through investment bankers for a structured underwritten offering. Tencent has grown to become one of the world’s largest companies, with its market cap surpassing that of even Facebook.
BIG DEALS The last few weeks of 2017 have seen some of the biggest plays in the year. At the Dubai Airshow, French plane manufacturer Airbus secured the largest commercial airplane deal in history with a $50bn order to American Indigo Partners. Airbus’s American counterpart and the other side of the industry duopoly – Boeing — secured its own deal for $20bn at the show. Even with a supposed deal with Emirates falling through, Airbus was certainly the winner in Dubai.
Elsewhere, the proposed AT&T merger with Time Warner is set to go to trial in March. The US Department of Justice is attempting to block the deal on antitrust grounds, over fears the new entity would be powerful enough to inhibit competition.
Meanwhile, in the healthcare sector, American retail pharmacy CVS Health has announced its intention to buy insurer Aetna, in a move that could change the healthcare landscape. It would be the first of its kind, involving as it does a pharmacy chain taking over a health insurance provider.
Offering fees on average 95% lower than competitors, DEGIRO clients trade with the lowest share dealing costs in Ireland. With low transaction costs, no minimums, and no annual or custodian charges, we don’t consider DEGIRO to be the cheaper alternative to investing so much as we see our competitors being needlessly expensive.
Clients of DEGIRO have access to over 60 markets across the world, can trade 700 ETFs commission free, and now have free real-time price feeds to US stocks. Additionally, clients in Ireland now pay no commission fee to invest across investment funds.
Originally from The Netherlands, DEGIRO started as an institutional broker in 2008 and began offering services to retail clients in 2013. DEGIRO is now one of the ten largest brokers in Europe and has won broker awards from the Financial Times and Investors Chronicle (UK), Beleggers Belangen (Netherlands), Investir (France), and Handelsblatt (Germany).
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