UMG Issues Statement Regarding Proposed Acquisition of Bill Ackman

universal music group A brief statement was released on Monday. Bill Ackman‘S proposed acquisition of a record company; The company’s board and advisors said they would “review the proposal in accordance with their fiduciary duties and analyze the impact on shareholders, employees, artists, songwriters and other stakeholders.”

“The board has full confidence in UMG’s strategy and the leadership of Sir Lucian Grainge and the company’s management team,” the company said. “UMG will not comment further on the proposal until the Board of Directors completes its review.”

Ackman’s Pershing Square Capital Management announced a takeover proposal worth about $63 billion late Monday. Ackman argued that UMG’s stock was undervalued despite its status as the world’s largest music company, citing a number of factors including UMG’s delayed listing on the U.S. stock market (the company now trades on Euronext, and Ackman had also pushed for a U.S. listing) and “optimal shareholder relations, communication and engagement.”

“Since UMG’s (stock market) listing, (UMG Chairman and CEO) Sir Lucian Grainge and the company’s management team have done an excellent job of nurturing and continuing to build a world-class roster of artists and delivering strong business results,” Ackman said. “However, UMG’s stock price has been weak due to a number of issues unrelated to its music business performance, and importantly, this transaction addresses all issues.”

Once the transaction is completed, UMG will merge with Pershing Square SPARC Holdings and the company will become a Nevada corporation listed on the NYSE.