Universal Music Group, the industry giant that represents global superstars like Taylor Swift, Sabrina Carpenter and Kendrick Lamar, has been acquired for $64.3 billion.
This offer has come from American investment company Pershing Square led by billionaire Bill Ackman. Under the proposed merger, the world’s largest music company would move its primary catalog to the US.
Bill Ackman is pushing for major changes at the world’s largest music company on the basis of “plunging stock prices”.
According to Ackman, the company has “done an excellent job of continuing to nurture and build a world-class artist roster and generate strong business performance,” but the issue of “declining stock prices” could be resolved through the transaction.
In a letter to his board of directors on Tuesday, Ackman attributed the company’s poor performance to various factors, including uncertainty around Bolloré Group’s 18 percent stake and the delay in its US listing.
Under the proposed terms, Universal shareholders would receive €5.05 per share in cash (a total of €9.4 billion) and 0.77 shares in the new entity to be listed on the New York Stock Exchange.
Following the announcement, Universal’s shares rose 11 percent in early trading. The company not only represents the industry’s A-list stars, but also runs Abbey Road Studios and owns labels such as EMI and Island Records.
