Tuesday, September 21, 2021
Gigantic course plus
Universal experiences a potential hit on the stock market
It is the largest IPO in Europe this year: Universal Music celebrates its debut on the Amsterdam Stock Exchange with an increase of 37 percent over the reference price. Unlike other industries, the music industry was able to benefit greatly from the Corona crisis.
The IPO of the world’s largest music label Universal turns out to be a European hit. When it debuted on the Amsterdam Stock Exchange, UMG shares opened at EUR 25.05 – an increase of around 37 percent over the reference price of EUR 18.50. The record company behind stars like Lady Gaga, Taylor Swift and The Weeknd was worth 46 billion euros and carried the largest IPO in Europe this year.
The French media group Vivendi announced in February that it wanted to put 60 percent of UMG shares on the stock exchange. The Universal Music Group, based in Santa Monica, California, is one of the big names in the global music business alongside Sony and Warner. The Vivendi group of the French businessman Vincent Bolloré wants ten Keep percent of UMG.
The remaining shares are divided among major shareholders such as US investor Bill Ackman and Chinese technology giant Tencent. Ackman had initially planned to get into Universal Music through his Spac, but thus called the US Securities and Exchange Commission on the plan. Spacs are initially just empty corporate hulls. You go on the stock exchange as a placeholder, in order to be merged with companies later on and to bring them to the stock exchange through the back door in a short way.
Universal Music’s sales were 7.4 billion euros last year. Like its competitors Warner and Sony Music, the company is betting that the boom triggered by streaming providers such as Spotify will continue for a while. The demand for streaming services – especially during the Corona crisis, when there were no live concerts – also boosted record companies’ sales. In order to gain new listeners, Universal works with Tiktok and Youtube, for example.