Billionaire investor Bill Ackman’s special purpose acquisition company (SPAC) Pershing Square Tontine Holdings has dropped a deal to buy 10% of Vivendi’s flagship Universal Music Group
Ackman’s SPAC last month agreed to buy 10% of Universal Music for $4 billion U.S.
Vivendi shareholders recently backed the spinoff of Universal Music, which gave the company an enterprise value of $41.55 billion U.S. The music corporation is home to stars such as Taylor Swift and Lady Gaga.
However, Pershing Square announced that its board had unanimously decided not to proceed with the purchase after discussions with the U.S. Securities and Exchange Commission (SEC).
Pershing Square said that it would now be pursuing a more conventional SPAC merger. It has 18 months to close a transaction unless shareholders vote for an extension.
Pershing Square’s share price has fallen 18% since the Universal Music purchase was announced on June 4, and Ackman said it had underestimated shareholders’ reaction to the “complexity and structure” of the transaction.
Despite dropping the deal, Pershing reiterated that it still intends to become a long-term shareholder of Universal Music after its public listing on the Euronext Amsterdam stock exchange this September.