Bill Ackman to Sell Remainder of UMG Stock After Pershing Square’s Failed Acquisition Bid
The move comes less than a week after UMG's board declined the hedge fund investor's offer.
Bill Ackman‘s Pershing Square Holdings is unloading the remainder of its shares in Universal Music Group (UMG) following its failed bid to acquire the music giant last week.
According to documents obtained by Billboard, Pershing Square is selling all of its 80.6 million shares in UMG — representing a 4.70% stake in the music giant — at a price marketed between 17.66 euros ($20.48) and 18.62 euros ($21.59). The transaction could bring in around 1.5 billion euros ($1.74 billion) at the high end of that range. Bloomberg was first to report news of the sale.
The move comes less than a week after UMG’s board rejected Pershing Square’s April 7 non-binding bid to purchase the company for more than 55.55 billion euros ($60 billion) — a price based on an expectation that UMG’s stock would rise to 30.40 euros ($35) per share by the end of this year. However, if UMG shareholders had elected to receive cash or a mix of cash and stock, the offer would have been for 22 euros a share, or as little as 40.34 billion euros ($43 billion) — less than UMG’s initial public offering.
If accepted, Pershing Square’s offer would have moved UMG’s primary stock listing, currently on the Euronext Amsterdam, to a U.S.-based exchange, something Ackman has been pushing for since 2024. In a statement on Thursday (May 30), the board said the offer “fundamentally and materially undervalues UMG and will not deliver superior value creation.” UMG also said there was a “strong consensus” against the bid from shareholders, particularly after the board’s approval to double its share buyback program, sell half of UMG’s Spotify stock and disclose more in-depth financial information.
The board’s decision arrived after Cyrille Bolloré, CEO of UMG’s largest shareholder, the Bolloré Group, urged them to reject the offer — which would have merged UMG with Pershing Square’s SPARC Holdings — saying the price was too low and that Ackman’s management style would clash with UMG culture. Pershing’s offer would have required Bolloré’s support to go through.
UMG’s stock was down just over half a percent in after-hours trading on Wednesday (June 3).
