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Billionaire investor Bill Ackman eyes US listing for Universal

Bill Ackman, whose clean examine acquisition company struck a deal to purchase 10 % of Universal Music Group final week, is exploring choices to extend his stake within the music label and expects to shut his subsequent deal quickly, he advised buyers on Wednesday.

The billionaire investor who runs hedge fund Pershing Square Capital Management and who raised the biggest-ever particular objective acquisition company (SPAC) almost a year in the past, described UMG as an “incredibly iconic, super durable business,” and mentioned he hoped for a US listing for the world’s greatest music label sooner or later.

UMG, which is being spun-off by France’s Vivendi, will full its deliberate Euronext Amsterdam listing in late September. Ackman mentioned UMG could possibly be listed within the United States by way of a direct listing on stock exchanges or by way of sponsored American Depositary Receipts.

“It is up to the board,” he mentioned, including that he needs to personal a much bigger stake in UMG and is in talks to determine a manner of doing so.

On a three-hour name with buyers, the Wall Street financier, whose strikes are intently watched, mentioned that he signed a confidentiality settlement earlier this week for his subsequent deal.

Bill Ackman mentioned he’s concerned with a much bigger stake in Universal Music Group, which is residence to quite a lot of huge acts, like Lady Gaga.
AFP through Getty Images

As he walked buyers by way of how his SPAC referred to as Pershing Square Tontine Holdings and UMG will work, he mentioned he’s assured buyers will follow Tontine even when its shares fall beneath the IPO value.

Earlier in June, Ackman mentioned he would search for one other deal by way of PSTH Remainco with the money that’s left, roughly $1.6 billion. Pershing Square funds personal roughly 29 % of Remainco, which has the choice of elevating a further $1.4 billion to finish a future deal. Even as Ackman is finishing the primary half, he’s engaged on the second half, having recognized a company and signed a confidentiality settlement.

At 4 p.m. ET, PSTH shares had been down 3.2 % at $22.97 a share, in contrast with $21.10 when it launched in June final year.

Buying a stake in Universal, whose acts embody famous person Taylor Swift, was personal for Bill Ackman, who mentioned his grandfather wrote lyrics that at the moment are owned by UMG.
Getty Images for MTV

PERSONAL BET

For Ackman, the funding in UMG is personal, he mentioned. Nearly 100 years in the past, his songwriting grandfather, Herman Ackman, offered lyrics that at the moment are owned by UMG. The company represents in style artists similar to Taylor Swift and Lady Gaga.

The take care of UMG capped a world hunt for an appropriate goal by Ackman, who thought of residence rental large Airbnb and Southeast Asian ride-hailing and meals supply agency Grab Holdings as targets.

The automobile ended up being totally different from most SPACs. They sometimes are shell corporations listed on stock exchanges to lift money, with the only objective of merging with an unknown non-public company to take it public.

Investors in Ackman’s SPAC will get Universal shares when they’re listed however won’t be able to train their present warrants. Investors will even get rights to purchase shares in a Special Purpose Acquisition Rights Company (SPARC) launched by Pershing Square, to do one more deal down the road.

The SPARC could have $10.6 billion in capital out there to spend on a brand new goal. It could have no deadline to spend the money and can ultimately be publicly listed, Ackman mentioned.