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Billionaire Bid for Universal Music Group
7 Apr
Summary
- Bill Ackman seeks to buy Universal Music Group for $64 billion.
- The offer includes cash and stock for Universal Music shareholders.
- The deal aims to address UMG's stock price issues unrelated to music.
Pershing Square Capital Management, led by activist investor Bill Ackman, has put forth a $64 billion offer to acquire Universal Music Group (UMG) in a cash-and-stock transaction. This proposed deal, valued at approximately 56 billion euros, would see Universal Music merge with Pershing Square SPARC Holdings, an acquisition company that received SEC approval in 2023.
The new entity is slated to be based in Nevada, with plans to transfer its stock listing from Amsterdam to the New York Stock Exchange. Ackman stated that the transaction is intended to address specific issues unrelated to UMG's music business performance that have caused its stock price to lag.
Universal Music shareholders would receive 9.4 billion euros in cash, alongside 0.77 shares of the newly formed company for each UMG share they hold. The total cash-and-stock value is estimated at 30.40 euros per share, or $35.12. Pershing Square anticipates the transaction could be completed by the end of 2026.
This development follows a previous attempt by Ackman in 2021 to acquire a 10% stake in Universal Music, which he later abandoned due to SEC inquiries regarding the acquisition company's structure. Shares of Universal Music saw a positive reaction, rising over 10% in midday trading in Amsterdam.
