Bill Ackman’s Pershing Square has today proposed merging its acquisition vehicle with Universal Music Group with a plan to list in the US in a deal aimed at reviving the world’s biggest music label’s value.<\/p>\n
Pershing Square’s cash-and-shares offer values Universal Music at around \u20ac30.40 per share, representing a 78% premium to last close price at \u20ac17.10 and making the deal worth \u20ac55.75 billion, according to Reuters calculation.<\/p>\n
Universal Music Group – the company behind recording artists including Taylor Swift, Billie Eilish and Drake – did not immediately respond to a request for comment.<\/p>\n
The Amsterdam-listed entertainment company’s shares jumped around 13% in the early trading today, while top shareholder Bollore Group’s were up 6%.<\/p>\n
Pershing’s move comes after UMG last month delayed a plan for a US listing, walking back on an agreement with Pershing, which had exercised its right to request a US offering and had argued a New York listing would boost UMG’s share price and liquidity.<\/p>\n
In a letter to UMG directors, Ackman said its management had done an “excellent” job of running a strong business and strategic execution, but its share price has languished since its listing in 2021.<\/p>\n
He blamed uncertainty over the 18% stake held by Bollore Group, the delay to the planned US listing and underutilisation of its balance sheet, among other things.<\/p>\n
Under today’s non-binding proposal, Pershing’s SPARC Holdings would merge with UMG and the new entity, to be called Nevada Corporation, would be listed on the New York Stock Exchange.<\/p>\n
Talent agent and former Walt Disney Company president Michael Ovitz would join the UMG board as chairman, Pershing Square said.<\/p>\n
Pershing Square said that under the transaction UMG shareholders would receive a total of \u20ac9.4 billion in cash and 0.77 shares in Nevada for every share held in UMG.<\/p>\n
The cash portion of the new proposed deal would be funded by Pershing from its SPARC’s rights holders, debt, and net proceeds from the company’s stake in Spotify, it said.<\/p>\n
Bollore Group did not immediately respond to a request for comment.<\/p>\n
A spokesperson for Vivendi, which is UMG’s second-largest shareholder, did not comment on the proposal.<\/p>\n
Tencent Holdings, UMG’s third-biggest shareholder, did not immediately respond to a request for a comment.<\/p>\n
The transaction is expected to close by the end of the year, Pershing Square said. It has a 4.7% stake according to LSEG data, making it UMG’s fourth-biggest shareholder.<\/p>\n","protected":false},"excerpt":{"rendered":"Bill Ackman’s Pershing Square has today proposed merging its acquisition vehicle with Universal Music Group with a plan…\n","protected":false},"author":2,"featured_media":386680,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[72,61,60],"class_list":{"0":"post-386679","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-business","9":"tag-ie","10":"tag-ireland"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/386679","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=386679"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/386679\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/386680"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=386679"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=386679"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=386679"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}