By Mauro Orru


Universal Music Group shareholder Bollore Group said it was calling on the record label to reject a $65 billion bid from Bill Ackman's Pershing Square Capital, a move that could derail efforts by the billionaire to take over the world's largest music company.

Cyrille Bollore, chief executive of the Bollore Group, said the bid from Ackman's Pershing Square Capital undervalued Universal. Pershing in April offered 30.40 euros a share in a cash-and-stock deal that values Universal's current stock outstanding at 55.89 billion euros, equivalent to $65.01 billion.

"I don't think that this offer is positive. I don't think it would be positive for the company and I encourage UMG management to reject that offer," Cyrille Bollore told shareholders at the company's annual general meeting on Wednesday.

Pershing didn't respond to a request for comment. Universal declined to comment, but previously said its board was reviewing the proposal.

Cyrille Bollore's remarks poured cold water on Ackman's efforts to land Universal, home to some of the world's most successful artists, including Lady Gaga, Taylor Swift, Billie Eilish and the Beatles.

The family of French billionaire Vincent Bollore commanded a stake of roughly 18.5% and nearly 40% of voting rights in Universal at the end of December, according to the music company's annual report.

"Without Bollore, we don't have a transaction," Ackman said in a call with investors on April 7 to present the deal. Universal's other major shareholders include Vivendi and China's Tencent Holdings, and any deal would require a two-thirds vote to pass.

Ackman has long sought to get Universal listed in the U.S., saying its stock price had languished due to what Pershing called uncertainty in relation to Bollore's stake in the company, the underutilization of UMG's balance sheet and the lack of a publicly disclosed capital allocation plan.

Pershing is seeking to merge Universal with Pershing Square Sparc Holdings, a specially created acquisition vehicle. The new entity would be based in Nevada and would shift its stock listing from Amsterdam to the New York Stock Exchange.

The label has operational headquarters in Santa Monica and corporate headquarters in Hilversum, Netherlands. It started trading on the Euronext Amsterdam in September 2021 after a spinoff from Vivendi.

Universal shares in Amsterdam are down nearly 30% over the past 12 months. Revenue from subscriptions and streaming services boomed during the pandemic when Covid-19 restrictions prevented people from attending live concerts. Those services are still resilient, but growth has cooled since pandemic highs.

Last month, the company reported weak revenue and earnings for the first quarter and said it would sell half of its 3.1% equity stake in Spotify Technology and channel funds to buy back shares.


Write to Mauro Orru at mauro.orru@wsj.com


(END) Dow Jones Newswires

05-27-26 0939ET