Bill Ackman's Pershing raises $1.4 billion in Universal Music Group stake sale
A group of Universal Music Group shareholders affiliated with billionaire Bill Ackman's hedge fund Pershing Square raised more than $1.4 billion from the sale of a 2.7% stake in the world's largest music company.
Pershing Square priced an offering of about 50 million Universal Music shares, according to terms of the deal seen by Bloomberg on Friday.
The placement comes as Taylor Swift's record label plans a U.S. share sale agreed in order to fulfill an agreement with Pershing Square, the company said in January. The deal required that Ackman's firm sell $500 million of its shares in connection with a U.S. listing, according to a post on Ackman's X account at the time.
Universal Music is Pershing's largest position and will be about 17% of the portfolio after the sale, Ackman wrote in an X post on Thursday.
'We believe UMG is one of the best businesses we have ever owned,' Ackman said.
Shares of Universal Music dropped as much as 11% in Amsterdam and pared this year's gains to about 2%.
Universal Music reported sales that topped analysts' estimates in the fourth quarter, boosted by growth from subscriptions to streaming platforms. Executives have focused on winning new subscribers on platforms such as Spotify, Apple Music and Amazon's Prime Music by converting listeners on free, ad-supported streaming tiers to paid premium subscriptions.
The company's top-selling artists of the fourth quarter were Swift, Billie Eilish, Sabrina Carpenter and Chappell Roan, as well as the soundtrack to 'Wicked.'
Morgan Stanley worked on the Amsterdam share sale, the terms showed.
Gopinath and Jacob write from Bloomberg. With assistance from Andre Janse Van Vuuren
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