Universal Music Group's board on Friday formally rejected an unsolicited takeover proposal submitted by Pershing Square, the investment vehicle associated with Bill Ackman. The offer, made in April through Pershing Square's acquisition vehicle, combined cash and stock and placed a per-share value of about 30.40, producing an overall transaction value of approximately 55.75 billion ($65.03 billion), based on Reuters calculations reported alongside the proposal.
In its response, Universal characterised the approach as falling short of the company's intrinsic worth. The board said the bid "fundamentally and materially undervalues UMG and will not deliver superior value creation," adding that it was "not in the best interests of UMG, its shareholders, artists, songwriters, employees and other stakeholders."
Pershing Square did not immediately provide a comment in response to requests for reaction.
Universal Music Group, which manages and markets global artists including Taylor Swift, Billie Eilish and Kendrick Lamar, is expected to move its primary listing from Amsterdam to New York. The company has presented that shift as a step that will allow a broader investor base - including index funds - to own shares, which UMG says will ultimately contribute to stronger earnings and a higher valuation.
Bill Ackman's interest in Universal is not new. He originally pursued UMG in 2021 through a shell corporation structured to publicize a private company, but that approach was abandoned amid U.S. regulatory scrutiny. Instead of completing a takeover then, Pershing Square became a significant investor in UMG, and Ackman held a board seat until last year.
Context and implications
The board's rejection underscores a valuation gap between Pershing Square's proposal and UMG's own assessment of its future prospects. The company emphasised stakeholder considerations - from artists and songwriters to shareholders and employees - in concluding that the bid would not yield superior outcomes.
Separately, the planned move to a New York listing is presented by UMG as a structural change intended to broaden ownership and support a higher market valuation. How that transition will play out in practice, and the timing of any such move, were not detailed beyond the expectation described.
Financial details
The April offer valued UMG at roughly 30.40 per share and pegged the total deal at about 55.75 billion, which converts to approximately $65.03 billion at the exchange rate noted in the reporting ($1 = 0.8573 euros). The precise makeup of cash versus stock in Pershing Square's bid was described as a cash-and-stock combination.
Recent history between the parties
Ackman's efforts to acquire UMG date back to 2021 when an initial structuring was abandoned after U.S. regulatory scrutiny. Following that development, Pershing Square assumed a substantial investor role in UMG and Ackman served on the company's board until stepping down last year.