Universal Music Group (UMG.AS) Rebuffs Ackman's €56 Billion Takeover Bid

Universal Music Group NV (UMG.AS) on May 29 rejected an unsolicited takeover proposal from Bill Ackman’s Pershing Square Capital Management, saying the offer materially undervalued the world’s largest music label and would not deliver superior value for shareholders or artists. Ackman’s complex plan, pitched in April, aimed to combine UMG with a US-listed acquisition vehicle, valuing the company at about €56 billion ($64.8 billion), or €30.40 per share. The offer included €5.05 in cash plus 0.77 shares of the new entity per UMG share. The board, backed by outside advisers, determined the bid fundamentally undervalued the business. The proposal required two-thirds shareholder approval and faced immediate opposition from top shareholder Vincent Bolloré, whose family holding company owns more than 18%. Earlier this week, his son Cyrille Bolloré publicly urged rejection. UMG had already sold half its Spotify stake and expanded buybacks to address some of Ackman’s concerns, and will provide enhanced financial disclosures. Chairman Sherry Lansing reaffirmed full confidence in CEO Lucian Grainge’s strategy.