The Music Business Has a Problem. Bill Ackman Just Pounced
Inside details of his $64B bid for Universal Music Group — a wager that Wall Street is misreading the entire sector
Glenn Peoples is the former lead analyst at Billboard; Robert Levine is the former deputy editor of Billboard and author of Free Ride: How Digital Parasites Are Destroying the Culture Business, and How the Culture Business Can Fight Back.
The good news for Universal Music Group is that Pershing Square Capital Management CEO Bill Ackman just bid to buy the company in a transaction the fund valued at $64 billion, a 77 percent premium over Monday’s closing price. The catch is that Ackman’s plan involves a bit of financial engineering — moving the company’s public listing from the Euronext Amsterdam stock exchange to a U.S. exchange and allocating capital differently. Even Pershing Square’s valuation of the offer reflects its forecast for the value of the company after it’s listed in the U.S.
Ackman, who holds a 4.7 percent stake in UMG and served on the company’s board from 2021 until last May, isn’t the first investor to think the market is undervaluing a music stock. Paris-based Believe, a global provider of distribution and marketing services, was taken private in 2025; and Reservoir Media, a New York-based record label and music publisher, received a takeover offer in February from Irenic Capital Management.
But Ackman’s offer reflects an ugly reality: Investors are falling out of love with music companies.
Oddly, even though prices for recording and publishing catalogs remain high, the value of the companies that control most of them has plummeted — which implies that they could be undervalued.
Universal Music Group was down 23.1 percent year to date through Monday. Warner Music Group was down 14.6 percent, Spotify was off 16.5 percent and South Korea’s K-pop companies were down anywhere from 17.2 percent (JYP Entertainment) to 37.2 percent (SM Entertainment). Major stock indexes have fallen in recent months, due to the U.S. and Israel’s war with Iran and the resulting rise in oil prices, but none are down this much.
Which raises a bigger question: If the underlying assets are so valuable, why are the companies that own them getting punished?
It seems unlikely that a U.S. re-listing alone would change the value of the stock significantly, and by Tuesday afternoon several theories emerged about the logic behind Ackman’s bid.
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