By Mathieu Rosemain
PARIS, May 27 (Reuters) – Cyrille Bollore, chief executive of the Bollore Group, said on Wednesday he was urging Universal Music Group’s management to reject Bill Ackman’s takeover proposal, citing three key objections: the price was too low, the deal used UMG’s own money rather than Ackman’s, and Ackman’s management style was incompatible with the label’s long-term strategy.
“We think the price is not there at all,” Bollore told shareholders at the group’s annual meeting. “He is not making an offer with his own money. It is our money, the company’s money.” On Ackman’s approach, he added: “I am not sure he is compatible with the management of this company — he is more abrupt, faster.”
Bollore said he considered the offer as good as already rejected. “I encourage the management of Universal Music to reject it. As far as I am concerned, it is as if it has been rejected,” he said.
Bollore’s backing is pivotal. Ackman, the billionaire activist investor who runs hedge fund Pershing Square, has said “without Bollore, we don’t have a transaction,” as Bollore’s stake in UMG effectively gives him veto power over any deal.
Pershing Square’s proposal values UMG at around 55.8 billion euros ($64.4 billion), or 30.4 euros per share — a 78% premium to UMG’s closing price on April 2. Under the terms, shareholders would receive 9.4 billion euros ($10.85 billion) in cash and 0.77 shares of new stock for each UMG share held. The plan also includes relocating UMG’s primary listing from Amsterdam to the United States, which Ackman argues could attract a broader pool of institutional investors and improve liquidity.
(Reporting by Matthieu Rosemain; editing by Dominique Vidalon)
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