UMG

Pershing Square To Acquire An Additional 2.9% of UMG

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PARIS, France (CelebrityAccess) — French media conglomerate Vivendi announced it has agreed to sell an additional 2.9% of their subsidiary Universal Music Group to private equity investor Bill Ackman’s Pershing Square for a price of USD $1.149 billion.

The equity stake for the proposed sale is in addition to the 7.1% of UMG Pershing Square previously acquired, resulting in the hedge fund owning a full 10% stake in the label giant.

The sale of the additional stake in UMG is expected to close by September 9 with a sale price based on an enterprise value of €35 billion for Universal Music Group.

Ackman was forced to back away earlier this year from a complex $4bn deal acquire a stake in UMG through a special purpose acquisition company (SPAC) after the Securities and Exchange Commission expressed concerns about the proposed transaction.

Following news of potential regulatory headwinds, Ackman pivoted to using his hedge fund Pershing Capital to implement the acquisition.

The deal also comes ahead of Vivendi’s upcoming plan to spin off UMG as a standalone entity trading on the Euronext exchange after distributing 60% of the company to shareholders in September.

As well, Vivendi sold 20% of UMG to a consortium of investors led by Chinese telecom and digital streaming giant Tencent, meaning that by the end of September, Vivendi will have sold a full 90% of UMG.

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