Pershing Square to buy extra 2.9% of Universal Music for $1.15 bln (updated)

Pershing Square Holdings

31/08/2021 09:17

(Adds detail, background)
    PARIS, Aug 31 (Reuters) - American hedge fund manager Bill
Ackman's Pershing Square is buying an additional 2.9% of
Universal Music Group (UMG) from Vivendi  VIV.PA  for $1.149
billion, the French conglomerate said on Tuesday. 
    Vivendi said the transaction was based on an enterprise
value of 35 billion euros ($41.40 billion) for 100% of UMG's
share capital. 
    The deal, to close by Sept. 9, means Pershing Square will
own 10% of UMG's share capital after it bought a 7.1% stake from
Vivendi in August, the French company added.   urn:newsml:reuters.com:*:nL1N2PH1WO
    The transaction comes ahead of the distribution of 60% of
UMG's share capital to Vivendi's shareholders and the listing of
the company scheduled for September 21.
    UMG, which represents artists like Justin Bieber and Taylor
Swift, is benefiting from a music industry rebound, underpinned
by booming streaming revenues but also a recent surge in sales
of vinyl records and CDs.
    In January, Vivendi said a consortium led by Chinese media
group Tencent  0700.HK  had bought an additional 10% stake in
UMG, pushing its holding up to 20%. Tencent has been expanding
globally with stakes in Spotify  SPOT.N  and Warner Music Group
 WMG.O .   urn:newsml:reuters.com:*:nL1N2IY0I5
    Besides UMG, Vivendi's media assets include pay TV firm
Canal+, communications group Havas, video games firm Gameloft,
video-sharing firm Dailymotion, plus other publishing and
entertainment firms.
    The French conglomerate has said it plans to use the
proceeds from the UMG deals to reduce its financial debt and to
finance share buybacks and acquisitions.
    Billionaire Ackman had originally aimed to make the UMG
investment through a special purpose acquisition company (SPAC),
but is now buying in through his Pershing fund instead after the
initial plan hit hurdles.   urn:newsml:reuters.com:*:nL1N2OV0A2
    ($1 = 0.8455 euros)

 (Reporting by GV De Clercq; Editing by Louise Heavens and
Pravin Char)
 ((geert.declercq@tr.com; +33 1 4949 5343;))