UMG spends $290M buying back stock from Bill Ackman’s Pershing Square

UMG spends $290M buying back stock from Bill Ackman’s Pershing Square – amid fund’s exit from music company

Universal Music Group has bought back EUR €250 million of its own stock directly from Bill Ackman‘s Pershing Square.

The figure translates to about USD $290 million at current exchange rates.

UMG repurchased 14,156,285 of its ordinary shares at €17.66 each, the company said on Thursday (June 4).

The purchase formed part of the disposition of the entire remaining UMG position held by various Pershing Square funds.

It brings to an end Pershing Square‘s run as a shareholder in the company led by Sir Lucian Grainge.

Bloomberg reported on Wednesday (June 3) that Pershing Square will be selling around 80.6 million UMG shares via an overnight placing.

The sell-down followed UMG‘s board rejecting a takeover proposal from Ackman and Pershing Square.

Pershing Square‘s non-binding proposal, unveiled in April, valued UMG at approximately €55.8 billion ($64.4bn), or €30.40 per share.

The proposal would have merged UMG with Pershing Square SPARC Holdings, with the combined company incorporating in Nevada and moving its primary listing from Euronext Amsterdam to the New York Stock Exchange.

The €250 million repurchase was carried out separately from UMG‘s existing €500 million share buyback program, launched in March.

It was instead executed under an additional €500 million share repurchase authorization granted by shareholders at UMG‘s Annual General Meeting on May 13.

UMG said it intends to use the repurchased shares to meet obligations under its 2022 Global Equity Plan and/or to reduce its share capital.

UMG’s shares fell 6% in early-morning trade on the Euronext Amsterdam on Thursday, following the news of Ackman’s stock disposal.