Vivendi Shareholders Back Spin-off Of Universal Music Group

Shareholders of French media group Vivendi have voted in approval to the proposed spinoff of Universal Music Group.

The shareholders approved the distribution of 60% of Universal Music Group shares with a record level of 99.9% positive votes. With this approval, UMG, the world's largest music company, will be listed on Euronext Amsterdam. The listing could take place on September 21, 2021.

On Monday, activist investor Bill Ackman's SPAC Pershing Square Tontine Holdings announced a deal to buy 10% of UMG for around $4 billion. The deal gave UMG an enterprise value of 35 billion euros.

In January 2021, a Tencent Holdings-led consortium acquired additional 10 percent equity stake in UMG, lifting its ownership to 20 percent. UMG accounts for around three-quarters of Vivendi's profits and also represents huge stars like Taylor Swift, Drake, Justin Bieber and Billie Eilish,

Meanwhile, activist investment firms like Bluebell Capital Partners and Artisan Partners have been against the spin-off plan. According to them, the plan will only benefit big stake holders like Vivendi Chairman Yannick Bolloré, who owns about 30% stake, while it will be a burden to shareholders with a heavy tax bill.

Meanwhile, shareholders also voted in favor Vivendi's plan to buy back and cancel up to 50% of its stock. The shareholders approved the payment of an ordinary dividend of 0.60 euros per share with respect to fiscal year 2020. The dividend will be paid as from June 25, 2021, with an ex-dividend date of June 23, 2021.

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