Universal Music Group Explores Going Private With Buyout Firms Amid Share Price Slump

Universal Music Group (UMG), the world’s largest record company, has held preliminary discussions with leading private equity firms about a potential move to take the music giant private, according to a Bloomberg report. The talks come as the company faces pressure from a declining share price, slowing streaming growth in key markets and investor concerns surrounding artificial intelligence (AI).

According to people familiar with the matter, UMG’s management spoke with private equity firms including Apollo Global Management, TPG and Blackstone earlier this year. The company’s board is aware of the discussions, but the conversations have not progressed, and no formal sale process has been initiated. Neither UMG nor the firms involved commented on the reported discussions.

Share Price Decline Fuels Take-Private Speculation

UMG, which has a reported market value of around €29 billion ($32 billion), has seen its shares decline approximately 29% this year, taking the stock below its 2021 initial public offering price. The valuation gap between publicly listed music companies and privately traded music catalogues and other music assets has also added to questions about whether the company is being adequately valued by the market.

The latest discussions follow an earlier takeover proposal from investor Bill Ackman, whose Pershing Square Capital Management sought to acquire UMG and shift its listing from Amsterdam to the United States. The company rejected the proposal, although the reported undervaluation of the business has remained a concern among investors.

Bolloré Family’s Stake Key to Any Potential Deal

Any potential transaction would require the support of the Bolloré family, which holds more than 30% of UMG through personal investments and Vivendi, its media company. Chinese technology company Tencent also holds a stake of more than 11%.

Cyrille Bolloré had indicated in May that the family considered UMG undervalued, while leaving open the possibility of selling a small portion of its holding in the future. However, the family has not signalled an intention to sell its entire stake.

AI and Streaming Growth Add to Industry Pressures

The reported discussions come at a time when major record labels are navigating structural changes in the global music business. Streaming growth has slowed in the US and Western Europe, while independent distributors have gained ground by offering artists more flexible and artist-friendly arrangements.

At the same time, the rapid growth of AI-generated music has raised concerns among investors about competition for streams, royalty dilution and the potential misuse of copyrighted material. UMG has taken legal action against AI companies, including Suno and Anthropic, over copyright-related concerns.

Chief Executive Officer Lucian Grainge has previously said the company anticipated the rise of low-quality AI-generated uploads and potential streaming fraud, emphasising the need for platforms to protect artists, songwriters, labels and music publishers from unauthorised use of their work.

While the preliminary discussions do not indicate that a deal is imminent, they underscore the valuation challenges facing the recorded music industry as traditional revenue drivers evolve and AI reshapes the competitive landscape.