Kuke Music (KUKE) stock plummeted on Friday after the Chinese classical music licensing, subscription, and education services company announced its acquisition of a controlling interest in independent classical music company Naxos Music.
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Kuke Music acquired its stake in Naxos Music via two transactions with Naxos One and Desun Holding Limited. This saw it enter into a share subscription agreement with Naxos One at $6,000 per Class B share for a total of $105 million. It also acquired 108 Class A shares from Desun Holding Limited, which automatically converted into 108 Class B shares of Naxos One for $12,500 per share for a total of $1.35 million.
Kuke Music issued 652,997,260 new shares to Naxos One and 8,395,679 new shares to Desun Holding Limited to cover its purchase of Naxos One stock. With this, it now holds a 70.43% stake in Naxos One. This is worth noting, as Naxos One controls Naxos Music.
Kuke Music Stock Movement Today
Kuke Music stock was down 32.63% in pre-market trading on Friday, following a 1.67% dip yesterday. The shares have also fallen 70.13% year-to-date and 84.47% over the past 12 months. With that comes nearly 1 million shares of KUKE stock traded today, compared to a three-month daily average of about 36,000 units.
Is Kuke Music Stock a Buy, Sell, or Hold?
Turning to Wall Street, analyst coverage of Kuke Music is lacking. Fortunately, TipRanks’ AI analyst Spark has it covered. Spark rates KUKE stock an Underperform (39) with a $1 price target. It cites “poor financial performance, characterized by declining revenues and profitability, and negative cash flows” as reasons for this stance.
