Invoice Ackman’s Pershing Sq. on Tuesday provided to accumulate Common Music Group in a bid valuing the corporate at about $64 billion.
The proposal would transfer the world’s largest document label from Amsterdam to the New York Inventory Change, betting that U.S. markets would assign the next valuation to the corporate behind Taylor Swift, Drake, Kendrick Lamar and Dangerous Bunny.
The supply comes as Common’s shares have misplaced almost a 3rd of their worth because the firm’s 2021 IPO, at the same time as the worldwide recorded-music market has continued to develop.
Ackman argues the issue lies much less with the enterprise than with the inventory.
“UMG’s stock price has languished due to a combination of issues that are unrelated to the performance of its music business,” Ackman stated Tuesday, “and importantly, all of them can be addressed with this transaction.”
His supply would give Common shareholders €9.4 billion (round $11 billion) money plus 0.77 shares in a newly listed U.S. firm for every share they personal, implying a worth of about €30.40 (round $35) a share, a 78% premium to the place the inventory closed final week.
The activist investor is proposing a posh transaction that might merge Common with Pershing Sq. SPARC Holdings, his acquisition automobile. The plan additionally requires a reworked stability sheet and a brand new board led by former Hollywood superagent and Disney president Michael Ovitz, whereas protecting Chief Government Lucian Grainge in place.
Common Music Group and Vivendi didn’t instantly reply to requests for remark. A spokesperson from Pershing Sq. declined to remark past the agency’s public supplies.
Taylor Swift is one in every of Common Music Group’s most profitable artists.
Picture by JULIEN DE ROSA on Getty Photographs
The shareholder battlefield
Any deal faces a formidable impediment: Vincent Bolloré.
The 74-year-old French billionaire’s Bolloré Group owns 18.5% of Common immediately and has extra publicity via Vivendi, which holds 13.4%. By way of these stakes, Bolloré instructions a big majority of Common’s voting rights, greater than is required to approve the deal.
Ackman’s pursuit of Common has been years within the making. In 2021, he introduced plans to purchase a ten% stake via a SPAC, however the effort bumped into resistance from regulators and shareholders. He finally purchased the stake via his hedge fund as a substitute.
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Ackman joined Common’s board in 2022 and stepped down in 2025. Extra just lately, Common delayed its long-planned U.S. itemizing due to market circumstances, a setback that appeared to strengthen Ackman’s argument {that a} broader transaction may be the cleaner route.
Common shares rose as a lot as 13% on Tuesday earlier than paring beneficial properties to commerce about 10% larger, nonetheless properly under Pershing’s proposed valuation. Vivendi and Bolloré Group shares additionally moved larger.
A music big at a crossroads
The supply comes at a turbulent second for the music enterprise.
Common controls greater than 30% of the worldwide recorded-music market, alongside Sony Music and Warner Music Group.
Streaming helped rescue the business from the piracy-era collapse of the 2000s, however progress has slowed, and labels face stress from the platforms that distribute their music.
Synthetic intelligence has added a brand new supply of disruption.
AI-generated songs and deepfakes have intensified copyright disputes and raised new questions on how labels defend artists and monetize their catalogs.
If the transaction closes by year-end, as Pershing expects, the newly listed U.S. firm would inherit a catalog stretching from the Beatles to Dangerous Bunny, in addition to property together with the legendary recording studios – Abbey Highway Studios – the place The Beatles, Pink Floyd, Queen, Oasis, Radiohead, and Adele recorded their award-winning albums.
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