Pershing Square Holdings buys 7.1% of Vivendi's Universal Music Group for $2.8 billion

By Emmanuel Legrand

French media and entertainment conglomerate Vivendi has sold for the price of $2.8 million 7.1% of its music division Universal Music Group (UMG) to Pershing Square Holdings, the investment holding company of US businessman William Ackman, and its affiliates.

  Vivendi and Pershing entered into discussions on June 4, 2021, for the acquisition of 10% of UMG’s share capital owned by Vivendi, ahead of the listing of the company scheduled for September 21 on the Amsterdam Stock Exchange. 

  Pershing acquired 128,555,017 Ordinary Shares of UMG at approximately $21.78 per share. The transaction with Pershing Square Holdings and its affiliates values the company at €35bn for 100% of UMG’s share capital.

Evidence of UMG's attractiveness

  Ackman had initially planned to acquire 10% of UMG through a special purpose acquisition company (SPAC), but was forced to change his plans following reservations expressed by the USA's Securities and Exchange Commission.

  Vivendi said Ackman "has the right to acquire, by September 9, 2021, up to an additional 2.9% of UMG’s share capital through funds which he manages or in which he holds the majority of economic interest, based on the same valuation."  

  In a statement, Vivendi said it was "very satisfied with the arrival at UMG of Mr. Ackman, a major American investor, providing once again evidence of the music company’s global success and attractiveness."

  Vivendi has already sold 20% of UMG to a group of investors led by China's Tencent. A total of 60% of UMG’s share capital will be made available to Vivendi’s shareholders at the time of the IPO.