Bill Ackman’s Pershing Square Bids to Buy Universal Music Group

Key Points:

• Billionaire financier Bill Ackman's investment firm, Pershing Square Capital Management, offered to buy Universal Music Group and move its stock listing from Europe to the U.S., valuing the company at approximately €55 billion ($64 billion), a 78% premium over recent trading prices.
• Ackman, who previously held a stake in Universal Music and served on its board, cited the company’s strong business performance but noted its stock price has suffered due to factors unrelated to its music operations, including its European listing and uncertainty over the Bolloré Group’s 18% stake.
• The proposed deal involves a complex cash-and-stock transaction where a blank-check company created by Pershing Square would merge with Universal Music, re-incorporate in Nevada, and list on the New York Stock Exchange, financed partly by €5.4 billion in debt and €1.5 billion from selling Universal’s Spotify shares.
• Ackman intends to retain Universal Music CEO Lucian Grainge while refreshing the board by appointing former Disney president Michael Ovitz as chair and adding two Pershing Square representatives.
• Universal Music and the Bolloré Group have not commented on the proposal.