Billionaire investor Invoice Ackman’s hedge fund, Pershing Sq. Capital, is planning to purchase Common Music Group (UMG), the world’s largest music firm, which represents artists together with Taylor Swift, Unhealthy Bunny, Bob Dylan, and the Beatles.
The $64 billion pitch introduced Tuesday is Ackman’s newest transfer to show Pershing right into a “modern-day” Berkshire Hathaway and make him the following Warren Buffett. Pershing at present controls 4.6% of UMG shares. The deal would merge UMG and Ackman’s Pershing Sq. SPARC Holdings as a joint entity to be listed on the New York Inventory Alternate by the tip of the yr.
“The company’s management have done an excellent job nurturing and continuing to build a world-class artist roster and generating strong business performance,” Ackman mentioned in a press release. “However, UMG’s stock price has languished due to a combination of issues that are unrelated to the performance of its music business, and importantly, all of them can be addressed with this transaction.”
The transfer comes weeks after Pershing filed to be listed on the New York Inventory Alternate, marking Ackman’s newest try to go public within the U.S. The hedge fund has a market cap of $11.27 billion, $28 billion in property below administration, and Ackman is price $8.13 billion.
Ackman, a self-described “Buffett devotee,” is following in his idol’s footsteps by making an attempt to accumulate UMG. The IPO and joint itemizing with UMG would assist Pershing achieve entry to “permanent capital,” a key a part of Buffett’s investing playbook. Buyers can pull their cash out of a hedge fund quarterly or yearly, requiring fund managers to maintain money readily available and placing them susceptible to having to promote their holdings. After the IPO, Pershing would have entry to capital in its closed-end fund that may’t be immediately revoked; traders should promote their shares on the open market as a substitute.
Pershing declined to remark additional on the proposal. Common Music Group didn’t instantly reply to Fortune’s request for remark.
‘Be greedy when others are fearful’
Buffett, who has freely shared his investing recommendation for many years, is finest identified for one suggestion: “Be greedy when others are fearful and fearful when others are greedy.”
With this deal, it seems Ackman might be following that recommendation. Earlier than the announcement, UMG’s inventory, which is traded on the Euronext Amsterdam trade, was down about 22% yr up to now. Right this moment the inventory is buying and selling at 19.06 euros ($22.06), up about 2 euros ($2.32).
Pershing laid out what it sees as UMG’s weaknesses within the pitch’s announcement, explaining that the postponement of itemizing the corporate on a U.S. trade, underutilization of the corporate’s stability sheet, and poor investor relations and communications are causes for the corporate’s “underperformance.”
Buffett’s 1988 buy of Coca-Cola inventory stands as an instructive lesson for what Ackman is making an attempt with Common Music Group. Buffett moved aggressively into Coca-Cola within the aftermath of the 1987 Black Monday crash, constructing a $1.3 billion stake in a model that many traders had soured on. Simply as Buffett noticed Coca-Cola’s unmatched model moat and pricing energy as benefits that the market was briefly mispricing, Ackman is betting that UMG’s enduring place within the music trade represents an irreplaceable funding that can reward affected person capital.
This isn’t the primary time Ackman has adopted Buffett’s recommendation to make the most of cheaper shares, and Ackman has referred to as on others to do the identical. Final month, in a submit on X, Ackman informed traders to recover from the battle in Iran and purchase Fannie Mae and Freddie Mac shares, the 2 government-sponsored enterprises designed to prop up the mortgage market.
“Some of the highest quality businesses in the world are trading at extremely cheap prices,” Ackman wrote within the submit. “Ignore the MSM [mainstream media]. One of the most one-sided wars in history that will end well for the U.S. and the world. And we have the potential for a large peace dividend.”
When markets opened the following day, Fannie Mae’s inventory market climbed as a lot as 41%, and Freddie Mac surged as a lot as 34%, the biggest single-day strikes for every inventory since Might 2025. Fortune beforehand reported that Ackman’s tweet was the one apparent driver of the surge.
Studying from the previous
Ackman’s play for UMG requires the religion of the corporate’s traders, one thing he has fallen wanting previously. He was unable to persuade Pershing’s personal traders to again the corporate’s $25 billion IPO aim in 2024 after a collection of errors. Ackman downplayed the IPO dangers to traders and argued that the corporate might obtain a “sustained premium” to its internet asset worth, defying the fund’s regulatory prospectus.
The transfer was so disastrous that Pershing needed to “disclaim” Ackman’s feedback and within the following week, Ackman minimize the fundraising goal from $25 billion to $4 billion to $2 billion, earlier than placing the IPO off utterly.
With the hedge fund’s newest try, Ackman has tempered his expectations and is aiming to lift between $5 billion and $10 billion. He has modified his strategy by attempting to record each the closed-end fund and Pershing’s dad or mum firm. To encourage traders, each 100 shares of the closed fund they purchase will mechanically grant them 20 free shares of Pershing Sq. Capital Administration.
This strategy is a departure from Ackman’s previous head-over-heel dealings. In 2016, Ackman stood by former investor darling Valeant Prescribed drugs, whilst criticism mounted over the corporate’s aggressive drug value hikes and deceptive SEC disclosures. Ackman ultimately reversed course and offered the shares, however not earlier than dropping Pershing $3.2 billion.
Ackman can be identified for his unrelenting perspective towards his rivals. In 2012, he started a short-selling marketing campaign in opposition to Herbalife, which sells weight-loss shakes and nutritional vitamins. Ackman accused the corporate of working illegally and of being a “pyramid scheme,” and tried to drive the corporate’s inventory value down for 5 years. Ultimately, Ackman minimize his losses, and Pershing dumped all of the inventory.
In 2024, six years after the dispute, Ackman relished Herbalife’s inventory plunging to a 14-year low.
“It is a very good day for my psychological short on Herbalife,” Ackman wrote in a submit on X six years after the dispute. “And it is an even better day for the world to see one of the biggest pyramid schemes fail.”
Correction, April 7, 2026: A earlier model of this text misstated the share of UMG shares Pershing Sq. controls.
