Shifting Tides: Universal Music Group to Relocate Primary Listing to the US
A New Chapter Unfolds
In a significant move, Universal Music Group, the powerhouse behind iconic artists like Taylor Swift, Billie Eilish, and Drake, is set to transfer its primary stock exchange listing from the Netherlands to the United States. This decision comes on the heels of recent anti-Semitic attacks in Amsterdam, which have sparked widespread concern.
Unlocking Intrinsic Value
Billionaire Bill Ackman, founder of Pershing Square and a major shareholder of Universal Music Group, believes that the company’s current listing in the Netherlands has resulted in a significant discount to its intrinsic value. Ackman attributes this to limited liquidity, which can be largely attributed to the lack of a primary listing on the Nasdaq or New York Stock Exchange.
A Timely Decision
The recent events in Amsterdam, which saw Israeli soccer fans targeted by anti-Semitic groups, have provided a catalyst for this change. The mayor of Amsterdam has condemned the attacks, and Israel has announced plans to evacuate many of its fans. This disturbing turn of events has led Ackman to conclude that it is time for Universal Music Group to make the move to the US.
Pershing Square’s Privileges
As a major shareholder, Ackman and Pershing Square possess unique privileges that enable them to force the relisting of Universal Music Group. Documents reveal that Ackman acquired a 10% stake in the company as part of its spinoff from Vivendi in 2021. With a market value of approximately $46 billion, Universal Music Group is poised to unlock its true potential in the US market.
A Path Forward
Ackman has indicated that Pershing Square has not yet exercised its right to demand a relisting. However, with a contractual obligation to file a formal registration with the Securities and Exchange Commission within 120 days, the wheels are in motion for this significant change. As the music industry continues to evolve, Universal Music Group’s relocation to the US is set to have far-reaching implications.
A New Era Dawns
With its primary listing in the US, Universal Music Group is poised to tap into new opportunities and unlock its full potential. As the company embarks on this new chapter, it remains to be seen how this move will impact the music industry as a whole. One thing is certain, however – this decision marks a significant turning point for Universal Music Group.
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