What does that mean?<\/p>\n
It means that as of this morning, UMG has a \u20ac25.25 ($29.63) share price… which translates to a colossal valuation of \u20ac46.3 billion<\/strong> or $54.3 billion<\/strong> for the world’s biggest music rightsholder. (see below).<\/p>\n MBW will be monitoring the company’s performance on the stock market as the day proceeds.<\/p>\n This morning’s pricing validates the opinions of UMG’s more optimistic observers, including JP Morgan Cazenove, who recently suggested that UMG\u2019s \u201cfair value\u201d was actually \u20ac54 billion \u2014 equivalent to $64 billion.<\/p>\n JP Morgan analyst Daniel Kerven wrote in a report earlier this month: \u201cWe continue to believe that Warner Music Group is undervalued and that Universal Music Group should trade on a significant premium, given a better track record, better governance and best-in-class management.\u201d<\/p>\n Subsequent to the listing, UMG largely bids au revoir<\/em> to former Paris-based parent Vivendi, which now owns just 10% of UMG, while a Tencent-led Consortium owns 20%.<\/p>\n Pershing Square Holdings Ltd also owns 10%, and French businessman ex-Vivendi Chairman Vincent Bollor\u00e9’s \u2018Bollor\u00e9 Entities\u2019 owns 18.0%.<\/p>\n At a \u20ac46.3 billion valuation, Bollor\u00e9’s share of UMG is worth \u20ac8.3 billion ($9.7bn) this morning, while the Tencent-led Consortium’s 20% share is worth \u20ac9.26 billion ($10.86bn).<\/p>\n Vivendi and Pershing Square Holdings’ respective 10% stakes are each worth \u20ac4.63 billion ($5.43bn).<\/p>\n UMG provided potential investors with some detailed reading material last Tuesday (September 14) in the form of a pre-IPO prospectus<\/a>, which\u00a0 provided insight into its current and future shareholders, detai<\/a>ls of its new post-IPO board<\/a>, business risks, executive rewards, plus historical financial information and profit forecasts.<\/p>\n The firm’s new board<\/a> includes\u00a0 Sir Lucian Grainge, who is Chairman & Chief Executive Officer and Executive Director, and Vincent Vallejo, UMG’s Deputy Chief Executive Officer, Corporate and Executive Director.<\/p>\n The board also includes James Mitchell, Senior Executive Vice President and Chief Strategy Officer of Tencent Holdings Limited and a Director of New York Stock Exchange-listed Tencent Music Entertainment Group.<\/p>\n Universal\u2019s recorded music division\u00a0generated annual revenues<\/a>\u00a0of \u20ac5.97bn ($6.74bn) in 2020, up 6.7% YoY.<\/p>\n According to UMG’s prospectus, which you can read for yourself through here<\/a>, no single artist accounted for more than 1% of the company\u2019s recorded music revenue in 2020, while the company\u2019s Top 50 artists cumulatively accounted for 23%.<\/p>\n Catalog accounted for\u00a054%<\/strong>\u00a0of recorded music revenue (from digital and physical) at UMG in 2020, while frontline product (content less than three years old) accounted for\u00a046%<\/strong> of recorded music revenue.<\/p>\n UMG\u2019s catalog includes artists such as ABBA, Louis Armstrong, The Beatles, The Beach Boys, The Bee Gees, Andrea Bocelli, James Brown, Bon Jovi, Neil Diamond, Marvin Gaye, Guns N\u2019 Roses, Elton John, Bob Marley, Paul McCartney and Nirvana.<\/p>\n MBW\u00a0broke the news<\/a> in the middle of February that Universal Music Group’s former parent company<\/a> Vivendi was planning to take UMG public in the Netherlands this year.<\/p>\n At Vivendi\u2019s Annual General Shareholders\u2019 Meeting, the Paris-based company\u2019s shareholders voted 99.9% in favor<\/a> of the plan.<\/p>\n Last month Vivendi <\/a>revealed<\/a>\u00a0<\/a>that Pershing Square Holdings (PSH), run by billionaire Bill Ackman, will control 10% of UMG\u2019s share capital post-listing.<\/p>\n
\n![](\"https:\/\/www.musicbusinessworldwide.com\/files\/2021\/09\/Screenshot-2021-09-21-at-08.10.37-80x44.jpg\")
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