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June 3, 2021, 7:46 p.m. EDT

Ackman’s SPAC nears record $40 billion deal with Universal Music Group

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Maureen Farrell, Cara Lombardo

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’s not guaranteed Universal and the SPAC, Pershing Square Tontine Holdings Ltd.,  will reach a deal. If they do, it could be finalized in the next few weeks and isn’t subject to any additional due diligence, the people said.

The deal would have a €33 billion ($40 billion) equity value and a €35 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 /zigman2/quotes/202179234/delayed FR:VIV -0.48% , is the record label behind artists including Lady Gaga, Taylor Swift, Billie Eilish and the Weeknd. 

An expanded version of this report appears on WSJ.com.

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