Universal Music scores high on stock market debut

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Top line

Shares of Universal Music Group soared during the company’s Amsterdam stock exchange debut on Tuesday, as investors jumped at the opportunity to invest in one of the industry’s biggest players music as service revenues continue to grow.

Highlights

Shares of Universal Music Group were trading just below € 25 (around $ 29) on Tuesday morning – around 35% above the benchmark price of € 18.5 ($ 22) – after the company was listed on the Euronext Amsterdam stock exchange.

The company was valued at $ 39 billion the day before it went public.

At current prices, the company is valued at 44.5 billion euros (approximately $ 52.2 billion).

Universal split from French media group Vivendi, which was down about 13.6% on Tuesday on the Paris Bourse.

Vivendi will retain 10% of the capital and 60% of the shares will initially be distributed to its shareholders, according to deposits, the rest having already been sold to Bill Ackman’s hedge fund Pershing Square (10%) and a consortium led by Chinese tech giant Tencent (20%).

Key context

Universal is a true titan of the music industry and considered one of the “big three” record companies, alongside Warner and Sony. It operates around the world and has a roster of stars including Taylor Swift, Queen, The Beatles, ABBA, Lady Gaga, Bon Jovi, Eminem, Ariana Grande and Katy Perry. Its success underscores the dramatic to recover staged by the music industry as the rise of Diffusion offsets still declining record sales.

Further reading

Universal Music shares soar on market debut (WSJ)

Universal Music: How Much is the World’s Biggest Label Worth? (FT)

Recorded music revenue hits $ 12 billion in 2020 amid pandemic streaming boom (WSJ)


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