Ackman Pitches $65 Billion UMG Deal to Move Listing to US

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1:49Chase for business. Make more of what's yours. The Chase mobile app is available for select mobile devices. Message and data rates may apply. JPMorgan Chase Bank N.A. Member FDIC. Copyright 2026. JPMorgan Chase and Company. Bloomberg Audio Studios. Podcasts. Radio. News. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts or watch us live on YouTube. I did not have Universal Music Group being put in play on my bingo card, but billionaire activist Bill Ackman.

2:33I mean, I peeled that thing, bought it, sold it. I don't know why it's public. But billionaire activist Bill Ackman has proposed a bid for Universal Music Group to increase returns on one of his hedge fund's biggest holdings. Not really sure why, but our next guest does. Matthew Bloxham, senior media and tech analyst for Bloomberg Intelligence, is usually based in London, but he's here in New York, which goes to my theory.

2:54Alexis Christoforous:Yes. We're seeing a lot of London-based BI people here, which means somebody's buying these people dinner. They're not coming over of their own. I think we should swap. I'll go to London for a while and do the show from there. Matthew, tell us what's going on here with United Music Group and kind of what Bill Ackman's thinking. Yes, look, I think a lot of shareholders have been frustrated for quite some time with the share price performance of Universal Music. The numbers it's been posting performance-wise have been pretty decent, but the share price keeps going down. And I think, I mean, I've had a lot of incoming inquiries from clients over the last three or four months trying to kind of put this puzzle together.

3:30You know, the numbers look good, the share price is going down, what's going on? And I think to some degree, this is Bill Ackman, you know, expressing some public frustration about that kind of mismatch and trying to, I guess, propose, you know, a different future for Universal Music, but particularly kind of a more financially engineered future. So kind of sweating the balance sheet more, pushing leverage to two and a half times from one times, doing more buybacks, selling their stake in Spotify, just to kind of really crystallize some of the value that is there.

4:04Alexis Christoforous:Now, from what I understand, this is sort of a complicated proposal they're putting together here that involves, I guess, a SPAC here in the US. Valuing the company, I guess, at close to$65 billion, is that truly a 78 % premium? it would be but it's very much a kind of paper premium so if you look at the numbers basically what they've said is that on the 2026 earnings they think universal music should trade at about 25 times earnings it currently trades on about 17 okay and so they've applied that mold score to the earnings creative everything else out of that so kind of really there's there's kind of nothing substantial there it's not that there is an element of cash to the bid but it's not very much.

4:45And most of that cash is basically being funded by leveraging up the UMG balance sheet and by selling the Spotify stake.

4:52Alexis Christoforous:Well, then I wonder how real is this? Or is this just, is he throwing it out there to shake things up? Or can this thing really happen? I think he's throwing it out there to shake things up. And I think what we would expect to see from the company is perhaps, you know, kind of an acknowledgement that, you know, that there's more perhaps they could do to kind of crystallize the value and get it recognized in markets. But we'll see. I mean, obviously, the big fundamental risk to universal music, which is keeping that earnings multiple down, is AI. And whether in future we're going to be fans of real human artists or more fans of AI artists.

5:30No, say it isn't so. Oh, yay, yay. All right. We've got some big shareholders here. I'm going to go back to an old acquaintance of mine, Vincent Bellore. What's he want to do with the stock? He owns 18 % of the stock here. And I know there's always been concern in this company and in other companies he has holdings that he's a seller. He's a better seller here. And that could keep a lid on this thing. Yeah, that's certainly been a bit of an overhang. I'd be surprised if at this level he's a seller. And obviously it's even more complicated than that because Vivendi owns a stake in that. And he's the kind of most influential shareholder in Vivendi too.

6:01So, yeah, obviously I think he's probably playing a longer term game, kind of wants to get value crystallization at some point. but he's not the kind of person to be pressurized into something that doesn't fit his agenda, whatever that is.

6:14Alexis Christoforous:He also, Ackman says he wants to, he's very adamant about wanting to move the listing out of Amsterdam and move it here to the New York Stock Exchange. Why is that? I think the principal reason is because typically companies get a higher multiple on earnings in the US than they do in Europe. And so to some degree, it shouldn't really be this way, but by kind of shifting the listing from one jurisdiction to another, you magically create value by getting a lift in the multiple. As I say, I think that the big pushback on that for me is the AI threat. You know, we've seen multiple contraction for lots of industries on the back of the perceived AI risk.

6:51And I think that's very much in play here for the record labels, particularly Universal. There's another public trade and music company out there, Warner Music Group. And what are the valuation differences between those two? They're pretty same. They're both trading on about 17 times earnings. I think people see them very similarly. There's a much lower free float in Warner. I think almost a kind of public-private company. They both face similar risks. I think obviously for the last 10 years or so, Universal has been by far and away the number one record label. It kind of dominates the kind of charts in terms of its artists.

7:29In recent times, we have seen Warner kind of take some share, but it's kind of a relatively gradual thing. But I think largely investors kind of see them both as a play on the same fundamentals. Stay with us. More from Bloomberg Intelligence coming up after this. Everyone has been there. Your team's feedback is scattered across emails, chats, and sticky notes. It's a mess. But PDF Spaces and Adobe Acrobat gives you one collaborative workspace to streamline every file and comment. So, if you need six departments to finally agree on a proposal, do that with Acrobat. Need to turn a mountain of feedback into one plan of action?

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9:20See complete disclosures at public.com slash disclosures. Small businesses are the pulse of every community. They bring people together, create opportunities, and drive growth. With a widespread presence in communities across the country, Chase for Business supports small business owners at a local level. That makes it possible for you to connect, learn from each other, and grow together. There's a real commitment to seeing small businesses succeed. The Chase for Business team has knowledge and expertise that span a wide range of financial areas. They can help you make more informed decisions as you navigate the complexities of running your business.

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10:35Listen on demand wherever you get your podcasts or watch us live on YouTube. What's still happening despite all the uncertainty in the world is technology companies are doing deals. They are investing in AI. A lot of stuff going on, even today. So we asked Mandeep Singh to step in. Mandeep runs all the tech research for Bloomberg Intelligence, and we appreciate getting a few minutes of his time. Mandeep, let's start with Anthropic Broadcom Google. They're expanding a strategic collaboration that will allow Anthropic access to about three and a half gigawatts worth of computing power starting in 2027.

11:11Talk to you about what's going on with Anthropic and Broadcom and Google. Yeah, I mean, you remember the time when OpenAI signed all those deals for 10 gigawatt capacity? Yep. Well, things have changed. The momentum has shifted towards Anthropic in a big way. And now we see this deal, which really is a reflection of the momentum that Anthropic has generated from coding agents, from enterprise. In fact, Anthropics revenue has tripled from$9 billion to$30 billion in a span of four months. What? This is breakneck growth that we have never seen, at least until the time that I've covered this space.

11:52And, you know, now they are short of compute capacity. So they're signing all these multi-year deals to secure compute. Okay, so this might be like a basic question for someone who follows AI so closely. But is this all because people want to use Claude, like Anthropics Claude versus OpenAI's ChatGPT? I'm still using ChatGPT. I don't know if I'm very behind. Well, so it all comes down to use case. And what Anthropic decided, which in hindsight, and hindsight is just a week's here, you know, seems to be a very smart move, is really double down on coding agents as a use case. And this is really, you know, tools that developers use to complete their code, write full-on code, you know, that can save them hours.

12:42And now Enthropic has got 1 ,000 enterprise customers that are paying over$1 million plus each in a span of weeks. They've landed all these customers just for one tool, one product that they conceived in weeks. And they've been able to ramp that up so fast. So who are the peers for Anthropic? Again, just remind me, because I need my flowchart to remember who's who here. Who are the peers or who are the competitors for Anthropic? I mean, on the coding side, you know, you can think of names like Atlassian. They used to manage code. And coding agent is a new category. So when you think about, you know, an agentic AI that's solving code end-to-end, And this is the use case that everyone was waiting when they were asking the ROI question.

13:34This is the ROI that, you know, they were looking for. And think of the CapEx for 2027 now. Now that we have seen this revenue ramp from Anthropic, I bet you 2027 CapEx numbers are going up. When are these companies coming public? When can we see them? Because I don't even know who these people are. In the back half of the year. So it'll be Anthropic, you think, maybe? Anthropic, for sure. For sure. I would be very surprised if they don't use this opportunity. Chat GPT? Is that...? OpenAI. But OpenAI has got some trouble now. There was a point when OpenAI was the clear leader. They had the best growth.

14:12Well, Anthropica has actually surpassed OpenAI in terms of revenue run rate. Just to put it in context, OpenAI raised money at$852 billion in valuation in the last private funding round. Entropic was valued at$380 billion. So imagine a company growing faster, having surpassed OpenAI, was valued at half the valuation of OpenAI. So I would be very curious to see what is the next funding round for Entropic look like. And I think they should narrow the valuation gap that they have with OpenAI. And then what, so what does it mean for Broadcom? Because we're seeing that stock higher 3 % today. But does Broadcom benefit from this long-term runway of...

14:56I mean, clearly anything touching entropic ecosystem right now should do well, whether it's Broadcom, whether it's Google on the chip side. Google as a standalone chip company will have a sizable revenue from this entropic deal. And that's where, you know, Nvidia or anything touching open AI will probably see some headwind, at least on the back of this news. How often does this technology evolve? How quickly does it evolve? Like if I buy a piece of software today, or I'm not even sure what I'm buying. I'm not buying a piece of software. I'm buying some AI product. How long is that relevant for before some new technology comes along and makes it irrelevant?

15:40Like I'm going to buy something else. These companies are releasing new features every week. In fact, this coding agent product, as I said, was consumed in a matter of weeks. And so the next model release from OpenAI could be, you know, better than Anthropic. But the problem that OpenAI may run into is enterprise, you know, contracts are very sticky. Once you start using a product and it's a new product, new category, you're not going to rip and replace. And that's where what Enthropic is doing with coding agents, it's going to be sticky revenue because companies are signing million-dollar-plus contracts now.

16:21They're not just going to go back and start using OpenAI if their next product is better. So this is sticky, and that's why I think Enthropic has created a new category, whereas OpenAI was focused on the consumer side. They did really well with ChatGPT subscriptions, but they missed out on this opportunity in terms of focusing on coding agents and enterprise. Stay with us. More from Bloomberg Intelligence coming up after this. You need to make a huge presentation in an hour. Adobe Acrobat uses AI to take all your documents and generate a presentation with a single click. Build slides quickly and streamline the process.

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19:26Message and data rates may apply. JPMorgan Chase Bank N.A. Member FDIC. Copyright 2026. JPMorgan Chase and Company. You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at 10 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts or watch us live on YouTube. It's another day, which means it's another M &A trade in the health care space. Gilead Sciences agrees to buy private German biotech tubulus in a deal worth up to five billion dollars to boost its portfolio of cancer drug development. Let's start there with Sam Fezzelli.

20:05He covers all the healthcare stuff for Bloomberg Intelligence. He's based in London, lives in France, I think, but he's in New York. Go figure here today. So we got him in studio. Sam, what's Gilead doing here? What are they buying here? And what's the strategy?

20:18Sam Fazeli:First, can I just say I'm so happy to be here. You know I love coming here. I know you. And New York is you. I mean, the restaurant, the wine sommeliers love when you see you walk through the door. My flight door opened at 1650 last night. I was in the cab at 1715. That is 25 minutes door to door to the cab. Where are all these TSA issues? I'm not belittling them, but it didn't affect me. So I'm happy. Because you were exiting the airport. I'm special. Oh, you were also special. They rolled out a red carpet for you. Special passport. So what's Gilead doing? This is the second deal they've done in the past few months, a couple of months, I would say.

20:55Sam Fazeli:They are continuing to build an increasingly oncology-focused, is they do have various assets, as you know, in HIV and oncology, and they've been building this out. This is a very interesting acquisition, I have to say. It's a private German company. I've met them two or three times, listened to their presentation. It's in a space, Paul, that had been kind of thought of maybe China's taken over all of it, the ADCs, antibody drug conjugate world, and that there isn't really much to play for here. So they built this company,$401 million, the biggest European Series C ever announced about a few months ago.

21:35Sam Fazeli:And now I'm going to come back to that and connect you all up. In a space that you think China's overtaken the rest of the world and Europe. And here comes Gilead buying it for a hefty price, right? That$401 million, I don't know what the valuation was at that time, but this is a good deal for the investors. And what kind of treatments are they now going to be able to offer with this acquisition? Yeah, so Gilead already has a well-known Trudelvi ADC antibody. So what you do is that you put the drug, that's a chemotherapy often, that you want to avoid having the overall exposure in your body to an antibody that homes in on a tumor.

22:14Sam Fazeli:That's the principle, much harder than in reality to make work. So here what they're doing is buying a brand new, pretty broad profile platform and two drugs with it. So it's exactly in their wheelhouse. All right. Let's move on to the weight loss stuff because that's always in the news. Novo Nordisk will price its new high-dose Wagovi, which is what we use in the household, at$3.99 a month for cash pay patients, undercutting the cost of most doses of rival Eli Lilly's Zepbound. Is this just another example where this market is, we're now moving on to really competing on price? Yeah, but they have been, Paul, for a while.

22:53Sam Fazeli:And, you know, a lot of the times we don't actually see the price that people are paying because it goes through a different channel, the rebates, the discounts, you know all that story of how everybody's so focused on the list price and where actually people are getting is a much lower price, at least through the insurance. So it is not a surprise. It's going to keep happening. Novo needs to get its footing back in here. And it's interesting that it's happening just the week after that Lilly has been approved to launch their oral drug. Right. And that's the first week or two. This Friday, we might see some of the prescriptions flow through.

23:29Sam Fazeli:Everyone's focused on that. How strong a launch will that be? Is the expectation that even though you have to take this pill daily, people take pills all the time, it's no big deal, that this is going to really open up the market? Is that the expectation? Yeah, I mean, so the thing is that it doesn't give you as much weight loss as the jab. The jab is super powerful, right? But so you could think about it in many different ways. I'll just add it to my box. A lot of people have these boxes with their vitamins and minerals and all that. I'll just add it in there, take it. It doesn't have any food restrictions or anything.