Vivendi entered discussions to sell a 10 per cent stake in its Universal Music Group (UMG) business to Chinese web giant Tencent, as it looks to grow the unit’s presence in Asia.

In a statement, Vivendi said it was in preliminary talks about a sale, which would give UMG an initial equity valuation of €30 billion. As part of any agreement, Tencent would also have a one-year call option to acquire an additional 10 per cent at the same price and terms.

Vivendi has been searching for investment in UMG, which is currently the world’s biggest music company, since 2018.

The France-based group said it wants Tencent to promote its music artists, as well as identify and promote fresh talent in new markets.

Aside from the possible investment, the companies are also considering areas of strategic commercial cooperation, with Vivendi seeking ways for UMG to “capture growth opportunities offered by digitalisation and the opening of new markets”.

Bloomberg noted there may be concerns an investment from Tencent could catch the eye of US authorities, due to an ongoing trade war with China. However sources said the initial 10 per cent limit on the stake should be sufficient to avoid such scrutiny in the near-term.

In addition to its discussions with Tencent, Vivendi stated it also plans to continue exploring a sale of an additional minority stake in UMG to other potential partners.