Universal Music Group (UMG) has confirmed that its board of directors received an ‘unsolicited and non-binding proposal’ from Pershing Square to acquire the company. In a brief press release, the board expressed ‘complete confidence in’ the company’s strategy under chairman and CEO Lucian Grainge. The board will review the proposal, analyzing its implications for shareholders, employees, artists, and other stakeholders.
The proposed deal values UMG at over $60 billion and would involve a merger with Pershing Square SPARC Holdings. Pershing Square’s founder, Bill Ackman, believes that the deal can address issues that have led to UMG’s languishing share price, including uncertainty over investor Bolloré Group’s stake and the under-utilization of the music company’s balance sheet. Ackman expects the deal to close by the end of the year, pending review by UMG’s board of directors.
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