The US federal regulator and supervisor of financial markets has vetoed it.
The shareholders of Pershing Square Tontine Holdings (PSTH), the Spac of American financier Bill Ackman, had to reverse the agreement signed with Vivendi last month for the acquisition of a 10% stake in its subsidiary Universal Music Group ( UMG).
The operation, close to an amount of 3.5 billion euros, valued the entire group, number one in music at the head of a catalog ranging from the Beatles to Rihanna, at 35 billion euros.
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The Securities and Exchange Commission (SEC) opposed the original form of the agreement.
“
Our decision to seek another financial vehicle was prompted by issues raised by the SEC with several elements of the proposed transaction.
Regarding in particular its compliance with the rules of the New York Stock Exchange
, ”said PSTH in a statement released Monday.
As a result of this withdrawal, PSTH will pay compensation to Vivendi.
As soon as it was announced in May, the operation had raised doubts among some investors. Because the Spacs, acquisition vehicles without operational activity, had until now largely targeted companies as a whole, and not only part of the capital. “
We underestimated the reaction of some of our shareholders to the complexity and structure of the transaction,
” said Bill Ackman. Since the announcement of discussions with Vivendi on June 4, PSTH's stock had fallen by nearly 18%.
Despite this turnaround, the account still looks good for Vivendi.
Because the billionaire Bill Ackman declared himself ready to replace PSTH personally, via a set of investment funds, to acquire “
between 5% and 10%
” of UMG.
A proposal accepted by Vivendi.
"
If this portion turns out to be less than 10%, Vivendi still intends to cede the difference to other investors,
" even said in a press release the French media giant (owner of Canal + televisions, of the group of communication Havas, the Editis publishing group and Prisma Media).
Next listing in Amsterdam
In 2014, when Vincent Bolloré took control of Vivendi, Universal Music was valued at 7 billion euros.
In 2020, when Tencent entered the capital, the value had already multiplied by more than 4. Between 2020 and 2021, Vivendi sold 20% of the capital to the Chinese conglomerate Tencent (QQ and Wechat, the largest online communities in the world) based on a value of 30 billion euros.
Today, Vivendi intends to sell an additional 10%.
But the story is not over.
Vivendi has indicated its intention to list Universal Music on the Amsterdam Stock Exchange at the start of the school year.
Prior to that, on September 21, it will distribute 60% of the capital of Universal Music to Vivendi shareholders, via a dividend in kind and an interim dividend.
It is once listed in Amsterdam that we will know the market value of Universal Music.
Vivendi has undertaken to retain 10% of UMG's capital for at least two years, but it will no longer have any operational role.
He intends to set up a board of directors composed mainly of independent members, specifying that neither the Vivendi group nor the Bolloré group intend to sit on it.
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Vivendi turns the page on Universal Music to reinvent itself in the media
Driven by the growth of audio streaming, the group led by Lucian Grainge is in very good financial health. In the first quarter of 2021, Universal Music's revenue grew 9.4% to € 1.8 billion. The group, based in Santa Monica, California, posted a net profit of 135 million euros, against 89 million euros a year earlier.
