Universal Music Group shares surge following Bill Ackman’s bid
The largest record label in the world, Universal Music Group, which represents musicians like Taylor Swift and Kendrick Lamar. Had its stock soar early on Tuesday after billionaire Bill Ackman’s Pershing Square made an offer to purchase the business for roughly $64 billion.
Hours after Ackman’s company, Pershing Square, made an offer to acquire the big record label, UMG shares increased by about 10% at 9 a.m. EST on Tuesday.
In an offer to purchase UMG, which is traded on the Euronext Amsterdam stock exchange. Pershing Square would pay UMG shareholders 9.4 billion euros, or $10.86 billion, in cash and value the firm at 30.40 euros, or around $35.13, per share.
The deal would transfer UMG’s primary listing from Amsterdam to the New York Stock Exchange and combine the record label with Pershing Square SPARC Holdings.
Ackman stated that the board of directors would be «reorganized» to include Michael Ovitz, co-founder and former president of Creative Arts Agency. As chairman, along with two more Pershing Square representatives and members of UMG’s current board of directors. The agreement also suggested a new employment contract and compensation package for UMG CEO Lucian Grainge.
According to Ackman, $2.9 billion in cash from Pershing Square, $6.2 billion in debt financing, and $1.7 billion from the sale of UMG’s Spotify interest would be used to finance the cash portion of the deal.
