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Investing.com -- A group of Universal Music Group (AS:UMG) investors linked to Bill Ackman’s Pershing Square hedge fund sold around 2.7% of the company, raising over €1.3 billion ($1.4 billion), Bloomberg reported on Friday.
"We decided to sell a portion of our UMG position today," Ackman said in a post on X.
Shares in UMG fell around 9% in Amsterdam following the news. The stock closed at €27.90 a day earlier.
Ackman noted that Universal was Pershing Square’s largest holding at about 27% of its capital before the sale and remains the biggest position in the portfolio at approximately 17%.
Pershing Square Holdings Ltd., Pershing Square LP, and Pershing Square International Ltd. priced the offering at €26.60 per share for roughly 50 million Universal Music shares, according to deal terms seen by Bloomberg. On Thursday, a term sheet showed the shares were marketed in a range of €26.60 to €27.90.
The transaction comes as Universal Music, the biggest music company in the world, prepares for a U.S. listing.
In January, the company announced that the move was part of an agreement with Pershing Square, which required Ackman’s firm to sell $500 million worth of shares in connection with the listing.
"We believe UMG is one of the best businesses we have ever owned," Ackman wrote.
The company posted stronger-than-expected fourth-quarter sales, driven by rising subscription revenue from streaming platforms.
UMG has been working to expand its base of paying subscribers on services like Spotify (NYSE:SPOT), Apple (NASDAQ:AAPL) Music, and Amazon’s Prime Music, aiming to convert listeners from free, ad-supported tiers to premium plans.
Among Universal’s top-selling artists for the quarter were Taylor Swift, Billie Eilish, Sabrina Carpenter, and Drake, among others.