(Credits: Universal Music Group)
An offer of £48billion has been made to buy Universal Music Group (UMG) by billionaire Bill Ackman’s hedge fund.
The offer was made by a New York based hedge fund, Pershing Square, as they try to take ownership of the business which artists such as Drake, Taylor Swift, Olivia Rodrigo and SZA are signed to.
If a deal is made, it would see the music company valued as the biggest in the world.
Ackman released a statement about his offer to buy the business, saying that while UMG has done an excellent job continuing to put together a world class roster of music, there is no denying its share price has dropped in recent years.
The billionaire said that this lagging share price is the result of issues “unrelated to the performance of its music business.”
The news comes as shares in UMG dropped in value by more than a quarter in the past year; however, since the proposed purchase, they have increased by 11%.
UMG is one of the record labels from a select group known as the “big three.” The other two companies include Sony Music Entertainment and Warner Music Group.
Ackman said that he felt the dip in the company’s value over the year was due to uncertainty surrounding Bolloré Group’s, a French conglomerate’s, 18% stake in the company, delays in listings in the US, and the balance sheet not being utilised properly.
He also said that there was a “lack of investor credit” in the company’s previous valuation of its 2.7billion euro stake in Spotify.
UMG is yet to comment on the proposed offer.
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‘ The preceding article may include information circulated by third parties ’
‘ Some details of this article were extracted from the following source faroutmagazine.co.uk ’
