finance
Pershing Square Proposes $64 Billion Takeover of Universal Music Group
Bill Ackman's Pershing Square has submitted a $64 billion takeover bid for Universal Music Group. The proposal targets the music giant, which represents artists including Taylor Swift and Sabrina Carpenter. Universal's stock rose following the announcement, with Pershing Square citing issues affecting the company's share price.
Apr 7, 4:19 PM·2m read3 sources
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Pershing Square Capital Management, led by billionaire investor Bill Ackman, has proposed a $64 billion takeover of Universal Music Group. The bid aims to acquire the music industry's largest company through a complex transaction requiring shareholder approval. Universal Music Group, headquartered in the Netherlands, holds a significant portfolio of artists and labels.
The proposal values Universal at approximately $64 billion, as reported by multiple outlets. Pershing Square stated that Universal's stock price has declined due to various operational and market challenges. Following the announcement, Universal's shares increased on the Euronext Amsterdam exchange.
offer involves a merger structure to address what the firm describes as underperformance in Universal's stock.
The hedge fund, which manages about $12 billion in assets, has not disclosed specific terms beyond the valuation. Universal Music Group, a subsidiary of Vivendi until its 2021 spin-off, generates annual revenue exceeding $10 billion from streaming, recordings, and publishing. The transaction would need approval from Universal's shareholders, who include major institutional investors.
Ackman, known for activist investments in companies like Chipotle and Howard Hughes, views the bid as an opportunity to unlock value. No timeline for a shareholder vote has been specified.
shares rose by about 15% in early trading after the proposal became public.
Pershing Square highlighted issues such as shifts in streaming economics and competition from independent labels as factors languishing the stock. Analysts noted the bid could lead to a premium over the prior closing price of around 24 euros per share. The music industry has seen consolidation, with Universal controlling roughly 30% of the global recorded music market.
