Pershing Square is preparing to sell a sizeable stake in Universal Music Group, according to media reports on Wednesday. The hedge fund managed by Bill Ackman is said to be arranging an overnight placing of roughly 80.6 million shares in the music company.
Bank of America is reported to be marketing the block with an indicated pricing range of 17.66 to 18.62 per share, according to terms cited in the report. Those figures are presented as the range within which the sales effort is being offered to potential buyers.
The planned disposal follows Pershing Square putting forward a cash-and-stock takeover proposal for Universal Music in April. The proposed deal was valued at about 55.75 billion by the calculations cited in that offer.
Universal Music Group, which represents artists such as Taylor Swift, Billie Eilish and Kendrick Lamar, rejected the takeover bid last week. The company said the proposal "materially undervalued" the business and was not in the best interests of shareholders, artists or the firm, according to the statement referenced in the reporting.
The reported placing and the earlier offer are the two discrete developments outlined in the recent reporting: the April cash-and-stock proposal with the stated valuation, and the subsequent decision by Universal Music to decline the transaction on the grounds of inadequate valuation and shareholder interest.
The announcement of a marketed placing includes specific numeric details on share count and the price interval being sought by the bank handling the sale. Beyond those specifics, the reporting does not provide further information on timing beyond the description of an "overnight placing," or on how buyers may allocate the offered shares once marketed.
Observers of both the entertainment sector and capital markets will note the actors named in the report: the investor group arranging the sale, the bank marketing the shares, and the music company that declined the takeover bid. The reporting does not offer additional commentary from the parties involved beyond the valuation-related statement attributed to Universal Music when it rejected the offer.
Context limitations - The reporting details the size of the proposed placement, the marketed price range and the value Pershing Square attached to its earlier approach, and records Universal Music's stated reason for declining the offer. The report does not include other statements from Pershing Square, Bank of America or Universal Music beyond the quoted rejection language, nor does it provide further detail on execution timing or purchaser identities.