US EditionUniversal Music to Sell Half Its Spotify Stake for Buybacks, Q1 Hit by Weak Dollar
The sale is expected to raise about $1.4 billion and support buybacks as UMG reported flat first-quarter revenue of 2.9 billion euros.
- Universal Music Group confirmed Wednesday it will sell half of its stake in Spotify to enhance shareholder value while maintaining flexibility for the Company.
- UMG reported flat first-quarter revenue of 2.9 billion euros , prompting the strategic divestment of its long-term investment in the streaming platform.
- Nearly 6.5 million shares—3.16 percent of Spotify—are being divested for about $1.4 billion, calculated from individual share prices of about $443.
- Bill Ackman and Pershing Square submitted an offer to sell the stake, but UMG executives declined to discuss the proposal during Wednesday's earnings call.
- UMG CFO Matt Ellis stated Thursday that the move provides necessary flexibility, as the company continues prioritizing AI partnerships with Nvidia and Splice.
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UPDATE 2-Universal Music to sell half its Spotify stake for buybacks, Q1 hit by weak dollar | Sports-Games
The decision allows UMG to honour its "Taylor Swift clause" - a commitment made in 2018 when the pop star re-signed with the label on the condition that any proceeds from a Spotify stake sale would be shared with all artists on a non-recoupable basis. UMG said it also planned to launch an additional 500-million-euro share buyback, subject to shareholder approval at its annual general meeting, doubling its total buyback authorisation.
Universal Music Group to Sell Half of Its Spotify Stake, Reports $3.3 Billion in Revenue
The move comes weeks after Bill Ackman and Pershing Square had submitted an offer to acquire UMG, including in that proposal a plan to sell the company's Spotify stake.
Universal Music to sell half its Spotify stake for buybacks, Q1 hit by weak dollar
Universal Music Group said on Wednesday it would sell half of its equity stake in Spotify and double its share buyback programme, as it reported first-quarter revenue held back by a weaker U.S. dollar.
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