Bill Ackman’s Pershing Square Bids to Take Over Universal Music Group

Pershing Square Capital Management has submitted a non-binding proposal to the board of directors of Universal Music Group (UMG) to acquire all outstanding shares of the company. The bid, announced on April 7, 2026, values the world’s largest music company at approximately €55.8 billion, which is roughly $64.4 billion.

The proposal comes from billionaire Bill Ackman, whose New York-based hedge fund seeks to take the company private through a business combination transaction. UMG serves as the home to a massive global roster of artists, including Taylor Swift, Elton John, Adele, Drake, and Ariana Grande, spanning genres from classical music to contemporary pop.

Terms of the Proposed Acquisition

Under the terms of the bid, UMG shareholders would receive a combination of cash and stock. Specifically, the proposal offers €9.4 billion in cash, which equates to €5.05 per share, alongside 0.77 shares of a newly created entity, referred to as New UMG, for each share of UMG currently held.

Pershing Square estimates the total consideration package to be worth €30.40 per share. This represents a 78% premium compared to UMG’s closing price on April 2, 2026.

The transaction would involve UMG merging with Pershing Square SPARC Holdings, Ltd. The resulting combined entity would incorporate as a Nevada corporation and list on the New York Stock Exchange. Pershing Square stated that this move would allow the company to publish financial statements under US GAAP and become eligible for inclusion in the S&P 500 and other indices.

The deal is expected to close by the end of 2026. As part of the transaction, 17% of UMG’s outstanding shares would be cancelled, leaving New UMG with 1.541 billion shares outstanding. Pershing Square and its affiliates would backstop all equity financing, with all debt financing committed at the time of signing.

Rationale for the Takeover

Bill Ackman argued that UMG’s share price has suffered due to factors unrelated to the actual performance of its music business. While he acknowledged that Sir Lucian Grainge has done an excellent job nurturing and continuing to build a world-class artist roster and generating strong business performance, he noted that the stock has languished.

Ackman attributed the poor share price performance to several specific issues:

• The delay of UMG’s listing in the United States.
• The underutilisation of the company’s balance sheet.
• Uncertainty regarding the 18% stake held in the company by the French conglomerate Bolloré Group.
• A lack of investor credit regarding UMG’s €2.7 billion stake in the music streaming service Spotify.

These factors contributed to UMG shares losing more than a quarter of their value in the year leading up to April 2026. UMG has been listed in Amsterdam since 2021 and is one of the big three record labels, alongside Warner Music Group and Sony Music Entertainment.

Industry Context

The bid targets a company that remains a dominant force in the global music industry. The scale of UMG’s influence is highlighted by the ability of its top artists to drive physical media trends, such as Taylor Swift’s impact on US vinyl sales, which topped $1 billion for the first time since 1983.

Pershing Square, which Ackman established in 2004, currently controls more than $26 billion in assets. Universal Music Group has not immediately responded to requests for comment regarding the proposal.