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Hedge-fund billionaire William Ackman's special-purpose acquisition company is nearing a transaction with Universal Music Group that would value the world's largest music business at about $40 billion, people familiar with the matter said.
The deal would be the largest SPAC transaction on record, exceeding the roughly $35 billion that Singaporean ride-hailing company Grab Holdings Inc. was valued at in a similar deal recently, according to Dealogic. It would have a so-called enterprise value, taking into consideration Universal's debt, of about $42 billion.
It isn't guaranteed Universal and the SPAC, Pershing Square Tontine Holdings Ltd., will reach a deal. If they do, it could be completed in the next few weeks and isn't subject to any additional due diligence, the people said.
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The deal would have a $40 billion equity value and a EUR35 billion enterprise value, a measurement that takes into consideration the amount of debt and cash a company has on its balance sheet.
Universal, a subsidiary of French media conglomerate Vivendi SE, is the record label behind artists including Lady Gaga, Taylor Swift, Billie Eilish and the Weeknd. Its stable also includes classic acts such as Queen and the Beatles, and last year it bought Bob Dylan's entire publishing catalog.