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Vivendi’s Bid To Sell 10% Universal Music Stake To Bill Ackman SPAC Collapses; Deal Transfers To Ackman’s Hedge Fund

Pershing Square Tontine Holdings, the SPAC founded by hedge fund billionaire Bill Ackman, has pulled out of a deal to acquire 10% of Universal Music Group from French media giant Vivendi.

In a statement on Monday, Pershing Square Tontine Holdings said it had walked away from the agreement, which valued Universal Music at €35 billion ($41B), after the Securities and Exchange Commission raised concerns about the legitimacy of the deal that remain unresolved.

Instead, Ackman’s Pershing Square hedge fund will acquire the holding, Vivendi said. “Pershing Square Tontine Holdings Ltd. (PSTH) has informed Vivendi that it intends to assign its rights and obligations to acquire 10% of the share capital of Universal Music Group (UMG) under the agreements announced on June 20, 2021 to investment funds with significant economic interests or management positions held by Mr. William Ackman. Vivendi has decided to approve such request,” said a Vivendi statement.

Pershing Square Tontine Holdings said: “While we believe our shareholders recognize UMG’s extraordinary attributes, including its attractive growth characteristics, business quality and superb management team, we underestimated the reaction that some of our shareholders would have to the transaction’s complexity and structure. We also underestimated the transaction’s potential impact on investors who are unable to hold foreign securities, who margin their shares, or who own call options on our stock.”

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