Pershing Square Targets Universal Music in $63bn Takeover Approach

Offer implies roughly $35 per share valuation for world’s largest music company

Bill Ackman’s investment firm Pershing Square Capital Management has submitted a takeover proposal for Universal Music Group, in a move that could reshape ownership of the global music industry leader.

The proposal, disclosed Tuesday, combines approximately $10.9bn in cash with additional equity, valuing UMG at about $35 per share. The offer represents a significant premium to the company’s recent trading levels and places the total enterprise value above $60bn.

Pershing Square argued that UMG’s valuation has been constrained by structural uncertainties, including questions around its ownership framework, its investment exposure to Spotify, and delays tied to a previously planned US listing. Ackman had earlier pushed for a dual-listing structure alongside UMG’s existing presence on Euronext Amsterdam.

Despite expressing support for UMG’s leadership under chief executive Lucian Grainge, Ackman signaled dissatisfaction with the company’s share price performance.

“UMG’s stock price has languished due to a combination of issues unrelated to the underlying strength of its music business,” Ackman said, adding that these could be addressed through the proposed transaction.

The hedge fund has been an active shareholder since acquiring a stake in UMG through a 2021 deal with Vivendi, and has since been vocal about strategic and financial improvements.

Under the terms outlined, shareholders would receive both cash and stock—approximately 0.77 shares in a newly structured entity per existing UMG share. Pershing Square stated that the transaction would enable a reduction of roughly 17% of outstanding shares while maintaining an investment-grade balance sheet.

The firm also highlighted several governance and capital allocation concerns, including uncertainty surrounding the Bolloré Group’s 18% stake, perceived underutilisation of UMG’s balance sheet, and the absence of a clearly articulated long-term capital allocation strategy.

Universal Music Group as it exists today was built through a series of major acquisitions and restructurings, beginning with the rise of PolyGram in the late 20th century. PolyGram itself was originally formed as a joint venture between Philips and Siemens, growing into one of the world’s largest record company with labels like Island Records (home to Bob Marley, Grace Jones and U2) and Mercury Records.

The modern UMG structure began to take shape in 1998, when Seagram—which already owned Universal Studios and its music division—acquired PolyGram for roughly $10bn. This merger combined PolyGram’s vast international catalog with Universal’s existing labels, creating what became Universal Music Group. The deal instantly positioned UMG as the largest music company in the world, with unmatched scale in both recorded music and publishing.

In 2000, Seagram itself was acquired by Vivendi, folding UMG into a broader media and telecommunications empire. Under Vivendi, UMG expanded further through acquisitions, most notably the recorded music division of BMG in 2007 (later fully integrated by 2008 after regulatory approvals), significantly boosting its catalog and market share.

Over the following decade, UMG continued to consolidate its dominance by acquiring EMI’s recorded music business in 2012 from Citigroup after EMI’s collapse. This brought in legendary catalogs including The Beatles in recorded form (via Parlophone/Capitol distribution structures), further cementing UMG’s leadership.

The final major structural shift came in 2021, when Vivendi spun off UMG as a separately listed company on Euronext Amsterdam, distributing shares to its investors—including a significant stake retained by the Bolloré Group. This listing marked UMG’s transition from a subsidiary within a conglomerate to an independent global music powerhouse.

UMG now controls the most valuable music portfolios in the world, spanning both historic legends and modern global superstars including Drake, Nicki Minaj and Taylor Swift.

Pershing Square said it would fully backstop the equity financing and secure committed debt financing at signing, underscoring its intent to execute the deal swiftly.