Bill Ackman’s Pershing Square has submitted a bid to buy Universal Music Group (UMG) in a cash and stock deal worth $64.4 billion.
The proposed bid would see shareholders receive $10.85 billion in cash and 0.77 shares of stock in the new company for each share of UMG held.
In a statement this morning, Ackman praised the performance of Universal under CEO Lucian Grainge but argued that the firm has “languished” in recent years.
“Since UMG’s listing, Sir Lucian Grainge and the company’s management have done an excellent job nurturing and continuing to build a world-class artist roster and generating strong business performance,” he said.
“However, UMG’s stock price has languished due to a combination of issues that are unrelated to the performance of its music business, and importantly, all of them can be addressed with this transaction.”
UMG has been listed in Amsterdam since 2021. The company’s shares have dropped 23% so far this year, according to reporting by CNBC. Ackman blamed its poor share price performance partly on the delay of UMG’s listing in the United States.
Ackman launched Pershing Square in 2004. The fund previously acquired a 10% stake in UMG in 2021.
Universal Music has yet to respond. The label is home to artists such as Taylor Swift, Drake, and Kendrick Lamar.