Pershing Square to buy extra 2.9% of Universal Music for $1.15 billion
Reuters
Published Aug 31, 2021 02:52AM ET
Updated Aug 31, 2021 04:20AM ET
PARIS (Reuters) -American hedge fund manager Bill Ackman's Pershing Square is buying an additional 2.9% of Universal Music Group (UMG) from Vivendi (OTC:VIVHY) for $1.149 billion, the French conglomerate said on Tuesday.
Vivendi said the transaction was based on an enterprise value of 35 billion euros ($41.40 billion) for 100% of UMG's share capital.
The deal, to close by Sept. 9, means Pershing Square will own 10% of UMG's share capital after it bought a 7.1% stake from Vivendi in August, the French company added.
The transaction comes ahead of the distribution of 60% of UMG's share capital to Vivendi's shareholders and the listing of the company scheduled for September 21.
UMG, which represents artists like Justin Bieber and Taylor Swift, is benefiting from a music industry rebound, underpinned by booming streaming revenues but also a recent surge in sales of vinyl records and CDs.
In January, Vivendi said a consortium led by Chinese media group Tencent had bought an additional 10% stake in UMG, pushing its holding up to 20%. Tencent has been expanding globally with stakes in Spotify (NYSE:SPOT) and Warner Music Group.
Besides UMG, Vivendi's media assets include pay TV firm Canal+, communications group Havas, video games firm Gameloft, video-sharing firm Dailymotion, plus other publishing and entertainment firms.
The French conglomerate has said it plans to use the proceeds from the UMG deals to reduce its financial debt and to finance share buybacks and acquisitions.
Billionaire Ackman had originally aimed to make the UMG investment through a special purpose acquisition company (SPAC), but is now buying in through his Pershing fund instead after the initial plan hit hurdles.
($1 = 0.8455 euros)
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.