Pershing Square has made a takeover offer worth about $64.3bn (£48bn) for Universal Music Group, the entertainment powerhouse behind global stars like Taylor Swift, Sabrina Carpenter and Kendrick Lamar.
The US investment firm, led by billionaire CEO Bill Ackman, is proposing a merger that would see the combined entity listed in the United States. Universal confirmed it has received the offer and will evaluate its impact on shareholders, employees, artists, songwriters and other stakeholders.
The world’s largest music company, which operates iconic facilities like Abbey Road Studios and owns labels such as EMI and Island Records, said its board retains full confidence in chief executive Lucian Grainge and his leadership team.
Ackman praised Universal’s management for building a “world-class artist roster” and driving strong performance, noting the company’s ability to harness opportunities in artificial intelligence while safeguarding intellectual property. However, he argued that the company’s stock has underperformed due to external factors that could be resolved through the proposed deal.
Pershing Square already holds a stake in Universal and has investments in major firms including Alphabet Inc., Meta Platforms, Amazon and Restaurant Brands International, owner of Burger King.
Market analysts caution that while Universal appears highly profitable, challenges remain. Growth in music streaming a key revenue source via platforms like Spotify and Apple Music has slowed, and disputes over royalty payments persist. The industry is also grappling with AI-driven deepfake songs that impersonate artists.
In his letter to the board, Ackman highlighted what he described as “dramatic underperformance” compared to major stock indices, citing uncertainty around an 18% stake held by Bolloré Group, controlled by billionaire Vincent Bolloré, as well as delays in listing the company on the New York Stock Exchange.
Universal is currently listed in Amsterdam, though Ackman has long advocated for a US listing. If successful, the move could position the company as the only major music firm on the S&P 500.
Industry insiders suggest the bid may be more about financial restructuring than operational changes. Meanwhile, investor enthusiasm was evident as Universal’s share price surged nearly 30% after news of the offer broke, before settling to gains of around 10% later in the day.
