Pershing Square Proposes €55.75 Billion Non-Binding Merger for Universal Music Group, Citing Undervaluation and Seeking U.S. Relisting

Activist investor Bill Ackman's Pershing Square Capital Management announced on April 6, 2026, a non-binding proposal to merge Universal Music Group N.V. (UMG) with its SPARC Holdings acquisition vehicle in a cash-and-shares transaction valuing UMG at €55.75 billion ($64.31 billion), according to calculations cited in a Reuters report republished by Newsmax on April 7, 2026. The offer prices each UMG share at €30.40, representing a 78% premium over the April 6 closing price of €17.10, as detailed in Pershing Square's letter to UMG's board and confirmed in the Newsmax article. UMG shareholders would receive €9.4 billion in total cash—equivalent to €5.05 per share—plus 0.77 shares in the new entity for each UMG share held, with the cash portion funded by SPARC rights holders, debt, and proceeds from Pershing's stake in Spotify, per the same Pershing letter cited across outlets.

The proposed merger would create a new Nevada corporation listed on the New York Stock Exchange, relocating UMG from its current Amsterdam Euronext listing established at its 2021 initial public offering, according to Pershing's announcement as reported by The Guardian on April 7, 2026, and Newsmax. Pershing Square, which holds a 4.7% stake in UMG as of LSEG data cited in Newsmax, was UMG's fourth-largest shareholder; this follows a reduction from an initial 10% stake acquired in 2021 during Vivendi's spin-off of UMG, a detail omitted in the Newsmax and Breitbart articles but noted in bias analyses referencing Deadline and Reuters historical coverage. Ackman served on UMG's board from 2021 until his resignation in May 2025 due to other commitments, per The Guardian's April 7 report citing Pershing's history.

Ackman praised UMG's management, led by CEO Sir Lucian Grainge, for an 'excellent job' in building its artist roster—including Taylor Swift, Drake, Billie Eilish, Bad Bunny, Adele, Ariana Grande, and Elton John—and delivering strong performance, according to his letter quoted verbatim in Newsmax, Breitbart, and The Guardian articles from April 7, 2026. However, Ackman attributed UMG's depressed share price—down nearly one-third since its 2021 IPO and trading at 21.8 times earnings versus Spotify's 40 times, per LSEG data in Newsmax—to factors including uncertainty over Bolloré Group's 18% stake (its largest shareholder), underutilization of UMG's balance sheet, lack of investor credit for its €2.7 billion Spotify holding, and what he described as a 'delay to the planned U.S. listing,' as stated in his letter and flagged as an unverified characterization in Newsmax's bias analysis.

This 'delay' claim stems from Pershing exercising its contractual right earlier to request a U.S. listing, which UMG reportedly walked back last month (March 2026), per Ackman's assertion elevated to subhead 'UMG WALKS IPO BACK' in Newsmax; however, no independent confirmation of a formal agreement or specific March delay appears in UMG announcements, CNBC, Deadline, or Variety coverage referenced in bias analyses, marking it as disputed and Ackman's view only. Separately, UMG announced a €500 million share buyback program on March 29, 2026, citing 'valuation dislocation,' according to UMG's press release and Yahoo Finance reports omitted across the three outlets analyzed.

Under the proposal, former Walt Disney president and talent agent Michael Ovitz would become board chairman, with two Pershing representatives added, and Grainge's employment contract would be renegotiated—his 2025 compensation exceeded €41 million including €30 million in bonuses, per The Guardian citing Ackman's letter. The deal requires approval by both boards, a two-thirds shareholder vote at a meeting, and regulatory clearances, with an expected close by year-end 2026, as outlined in Pershing's terms reported by all three outlets. ING analysts described the non-binding offer as potentially failing but meriting consideration for 'raising valid questions' about UMG's strategy, particularly its €1 billion annual M&A plans in emerging markets which could conflict with management retention, quoted in Newsmax.

UMG declined requests for comment from Reuters (via Newsmax), Breitbart, and The Guardian on April 7, 2026. Bolloré Group and Tencent Holdings (UMG's third-largest shareholder at 11.4%) did not immediately respond to comment requests per Newsmax, while Vivendi (10% stake, Bolloré-controlled) explicitly declined, as noted there. AJ Bell's Dan Coatsworth remarked Ackman would need a 'full-on charm offensive' with major shareholders, quoted in The Guardian, likening it to Warren Buffett-style buys.

UMG shares rose 12% on April 7 in Amsterdam trading, with Bolloré up 7%, per Newsmax market data matching CNBC and Deadline; The Guardian reported an 11% jump, and Breitbart noted over 10%. The bid occurs amid industry pressures including AI disruptions, as UMG, Sony, and Warner compete, with UMG's year-to-date drop of 23% cited in Deadline's bias-referenced coverage. Pershing, managing over $26 billion since Ackman's 2004 founding, previously abandoned a 2021 SPARC deal for a 10% UMG stake due to SEC/NYSE concerns, per Breitbart.

No denials of the proposal's existence have been issued by UMG or shareholders, though its non-binding status and approval hurdles underscore uncertainty. Ackman's history includes activist successes like Herbalife and losses like Valeant, contextualizing his push as an insider continuation given Pershing's stake evolution from 10% to 4.7%. The proposal highlights music industry consolidation trends amid global market tensions, positioning UMG for potential S&P 500 inclusion via NYSE, as implied in Music Business Worldwide coverage.