Universal Music Group board rejects Ackman takeover bid

The board of Universal Music Group has unanimously rejected an unsolicited takeover proposal from billionaire investor Bill Ackman’s Pershing Square Capital Management, concluding the bid undervalues the world’s largest music company. The decision, announced on May 29, follows a review by the board and its advisors.

The board stated the proposal, received on April 7, is not in the best interests of the company, its shareholders, artists, songwriters, employees, and other stakeholders. After careful review, the board determined the offer fundamentally and materially undervalues UMG and would not deliver superior value creation. The board added it believes there is a strong consensus among shareholders supporting its decision.

Pershing Square’s non-binding proposal had valued UMG at approximately 55.8 to 64.4 billion euros, or 30.40 euros per share, representing a 78 percent premium to the company’s closing price on April 2. Under its terms, shareholders would have received 9.4 billion euros in cash and 0.77 shares of new stock for each UMG share held. The plan would have merged UMG with Pershing Square SPARC Holdings, incorporating the combined company in Nevada and shifting its...