Universal Music Group shares came under pressure after Bill Ackman’s Pershing Square Capital Management completed the sale of its remaining stake in the company, ending a multi-year investment that had previously included an unsuccessful takeover attempt, according to a report by the Wall Street Journal.
The stock fell as much as 7.6% in early European trading, extending its year-to-date decline to close to 20% and reflecting investor reaction to the high-profile exit.
Pershing Square disposed of approximately 80.6 million shares in Universal Music, a position valued at more than $1.5bn. The hedge fund is expected to realise gains of at least $600m on the investment, according to reports.
In parallel with the secondary market sale, Universal Music repurchased a portion of the shares directly from Pershing Square as part of its broader buyback programme. The company acquired €250m worth of stock, pricing the transaction at €17.66 per share—below the prior day’s closing price.
The exit follows a period of heightened strategic engagement between the investor and the music rights group. Pershing Square originally built its position in 2021, prior to Universal Music’s listing on Euronext Amsterdam following its separation from Vivendi.
Earlier this year, Pershing Square reportedly submitted an offer to acquire the company outright at an estimated valuation of around $65bn. The proposal was rejected by Universal Music’s board, with shareholders including France’s Bolloré Group also expressing opposition on valuation grounds.
Universal Music, whose catalogue includes global artists such as Taylor Swift and Billie Eilish, has seen its shares come under pressure in recent months, with sentiment weakening despite continued strong underlying asset quality.
Market reaction to the exit was swift, with analysts suggesting the sale could weigh on sentiment given Pershing Square’s visibility as a long-term and high-profile shareholder. ING analysts noted that while the divestment was widely anticipated following the failed takeover approach, it still removes a prominent supporter of the stock and may be interpreted negatively by the market.
