UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
(Address of principal executive offices, including zip code)
Registrant’s telephone number, including area code:
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Securities registered pursuant to Section 12(b) of the Act:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 1.01. Entry Into a Material Definitive Agreement
On July 18, 2021, Pershing Square Tontine Holdings, Ltd. (the “Company”) entered into an Assignment Agreement (the “Assignment Agreement”) with Pershing Square Holdings, Ltd., a Guernsey limited liability company (“PSH”), Pershing Square L.P. a Delaware limited partnership (“PSLP”), Pershing Square International, Ltd, a Cayman Islands exempted company (“PSIL”), and PS VII Master, L.P., a Cayman Islands limited partnership (“PS VII, and together with PSH, PSLP and PSIL, the “Assignees”), pursuant to which the Company assigned its rights (the “Assignment”) under the Share Purchase Agreement, dated June 20, 2021 (the “SPA”), between the Company and Vivendi S.E., a corporation (société européenne) incorporated under the laws of France (“Vivendi”), to the Assignees. Under the SPA, the Company had agreed to purchase and Vivendi agreed to sell 10% of the share capital (minus one share) of Universal Music Group B.V. a private company with limited liability organized under the laws of the Netherlands (“UMG”), for $3,949,340,400 (the “Purchase Price”). PSH agreed to purchase or cause to be purchased at least 5% of the share capital of UMG on the terms and subject to the conditions of the SPA and Vivendi acknowledged that if the Assignees purchased at least 5% of the share capital of UMG, the SPA would be of no further force with respect to remaining UMG shares to be purchased under the SPA. In addition, the Assignees, severally in accordance with their obligations to purchase UMG shares, agreed to assume and reimburse the Company for out-of-pocket expenses incurred to date by the Company in connection with the transactions contemplated by the SPA. The Assignment Agreement is attached hereto as Exhibit 10.1 and is incorporated by reference herein.
The Assignees also assumed, severally in accordance with their obligations to purchase UMG shares, the Company’s obligations under the Indemnification Agreement, dated June 20, 2021, between the Company and Vivendi (the “Indemnity Assumption”). The Indemnity Assumption is attached as Exhibit 10.2 hereto and is incorporated by reference herein.
Item 8.01. Other Events
On July 19, 2021 the Company issued a Press Release which included a letter to the Company’s shareholders from William A. Ackman, the Company’s CEO, explaining (1) the Company’s withdrawal from its proposed acquisition and distribution to its shareholders of 10% of the share capital in UMG and (2) its assignment of its rights and obligations in connection therewith. The Company also announced that it had terminated its Redemption Tender Offer and its Warrant Exchange Offer. The Press Release is attached as Exhibit 99.1 hereto and is incorporated by reference herein.
Important Additional Information and Where to Find It
This Current Report on Form 8-K does not constitute an offer to sell or buy or the solicitation of an offer to buy or sell any securities. This Current Report on Form 8-K is not a recommendation to buy, sell or exchange any securities, and it is neither an offer to purchase nor a solicitation of an offer to sell securities. Information about the Company and certain of the matters discussed in this Current Report on Form 8-K is available at the SEC’s website at www.sec.gov.
Forward-Looking Statements
This Current Report on Form 8-K contains certain forward-looking statements within the meaning of the federal securities laws. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this release. You should carefully consider these and the other risks and uncertainties described in the Company’s annual report on Form 10-K and other documents the Company has filed with the SEC. Those filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and the Company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. The Company does not give any assurance that the Company will achieve its expectations. The inclusion of any statement in this Current Report on Form 8-K does not constitute an admission by the Company or any other person that the events or circumstances described in such statement are material.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. The following exhibits are filed with this Form 8-K:
| Exhibit No. |
Description of Exhibits | |
| 10.1 | Assignment Agreement, dated July 18, 2021, by and among Pershing Square Tontine Holdings, Ltd., Pershing Square Holdings, Ltd, Pershing Square International, Ltd, and PS VII Master, L.P. | |
| 10.2 | Indemnity Assumption, dated July 18, 2021, by and among Pershing Square Tontine Holdings, Ltd., Pershing Square Holdings, Ltd, Pershing Square International, Ltd, and PS VII Master, L.P. | |
| 99.1 | Press Release, dated July 19, 2021 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| PERSHING SQUARE TONTINE HOLDINGS, LTD. | ||
| By: | /s/ William A. Ackman | |
| Name: William A. Ackman | ||
| Title: Chief Executive Officer, Chairman of the Board of Directors | ||
Dated: July 19, 2021
Exhibit 10.1
ASSIGNMENT AGREEMENT
This ASSIGNMENT AGREEMENT (this “Agreement”) is made on July 18, 2021 by and among Pershing Square Tontine Holdings, Ltd. a Delaware corporation (“PSTH”) on the one hand, and Pershing Square Holdings, Ltd., a Guernsey limited liability company (“PSH”), Pershing Square L.P. a Delaware limited partnership (“PSLP”), Pershing Square International, Ltd, a Cayman Islands exempted company (“PSIL”) and PS VII Master, L.P. (“PSVII,” and together with PSH, PSLP and PSIL, the “PS Funds”) on the other hand and any persons or entities which become party to this agreement as a result of their entry into the Joinder Agreement, a form of which is attached hereto as Annex A (such persons or entities the “Affiliated Purchasers” and together with the PS Funds, the “Assignees”).
Capitalized terms used and not defined herein shall have the meanings given to them in the SPA (as defined below).
RECITALS
WHEREAS, PSTH is a party to the Share Purchase Agreement, dated June 20, 2021(the “SPA”), between PSTH and Vivendi S.E., a corporation (société européenne) incorporated under the laws of France (“Vivendi”), pursuant to which PSTH agreed to purchase and Vivendi agreed to sell 10% of the share capital and voting rights (minus one share) of Universal Music Group B.V. a private company with limited liability organized under the laws of the Netherlands (“UMG”), on a fully diluted basis (the “Sale Shares”) for an aggregate purchase price of US$ 3,949,340,400.00 (the “Purchase Price”).
WHEREAS, Section 18.5 of the SPA provides that PSTH may transfer its rights under the SPA or of the Sale Shares to an Affiliate (as defined in the SPA);
WHEREAS, in accordance with the terms of the SPA and as permitted thereunder, PSTH wishes to assign its rights under the SPA, including to purchase the Sale Shares, to the Assignees, subject to certain conditions as described herein (the “Assignment”);
NOW, THEREFORE, in consideration of the foregoing, the mutual promises set forth hereinafter, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and with the intent to be legally bound, the Parties hereby agree as follows:
| 1. | Assignment |
PSTH hereby assigns to the Assignees, and the Assignees hereby assume from PSTH, severally and jointly, all of PSTH’s rights as “Buyer” under the SPA, subject to the satisfaction of the conditions set forth in Section 2 of this Assignment Agreement. The Assignees each agrees that it shall purchase Sale Shares from Vivendi under the SPA in such respective percentages and amounts to be communicated by the Assignees to PSTH and Vivendi S.E. on or before the fifth (5th) Business Day prior to the Closing (or in the case of any Affiliated Purchasers in accordance with the percentages and amounts set forth in such Affiliated Purchaser’s Joinder Agreement).
| 2. | Condition of Assignment |
The continued effectiveness of the Assignment shall be subject to the condition that the PS Funds, together with any Affiliated Purchasers shall have committed to purchase an aggregate amount of share capital in UMG sufficient to ensure that the Assignees, in the aggregate, have committed to fund the Purchase Price; provided, however that (i) PSH hereby commits to purchase or cause to be purchased by one or several Affiliate(s) an aggregate amount of share capital in UMG representing at least 5% (five
percent) and no more than 10% (ten percent) of the total share capital in UMG under the terms and conditions of the SPA, including for the same price per UMG share, and that (ii) the SPA shall be of no further effect with regards to the sale of any remaining portion of the Sale Shares if the PS Funds purchase at least 5% (five percent) of such total share capital. As a further condition of the Assignment, the PS Funds, severally and not jointly, in proportion to their ultimate respective purchases of Sale Shares from Vivendi under the SPA shall assume and reimburse PSTH for any and all out-of-pocket expenses incurred to date by PSTH in connection with the transactions contemplated by the SPA
| 3. | Entire Agreement |
This Assignment Agreement constitutes the entire agreement and understanding of the parties hereto in respect of the subject matter hereof and supersedes all prior understandings, agreements, or representations by or among the parties hereto, written or oral, to the extent they relate in any way to the subject matter hereof or the transactions contemplated hereby. This Assignment Agreement may not be changed, amended, modified or waived (other than to correct a typographical error) as to any particular provision, except by a written instrument executed by all parties hereto.
| 4. | Assignment; Third Party Beneficiaries |
Except as otherwise provided herein, and as permitted under the SPA, no party hereto may assign either this Assignment Agreement or any of its rights, interests, or obligations hereunder without the prior written consent of the other parties. For the avoidance of doubt, rights under the SPA shall continue to be assignable, including by any Assignee, to any Affiliate of PSTH (as defined in the SPA). Any purported assignment in violation of this paragraph shall be void and ineffectual and shall not operate to transfer or assign any interest or title to the purported assignee. This Assignment Agreement shall be binding on the parties and their respective successors, heirs and assigns and permitted assignees.
Nothing in this Assignment Agreement shall be construed to confer upon, or give to, any person or entity other than the parties hereto any right, remedy or claim under or by reason of this Assignment Agreement or of any covenant, condition, stipulation, promise or agreement hereof. All covenants, conditions, stipulations, promises and agreements contained in this Assignment Agreement shall be for the sole and exclusive benefit of the parties hereto and their successors, heirs, personal representatives and assigns and permitted assignees.
| 5. | Counterparts |
This Assignment Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.
| 6. | Severability |
This Assignment Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Assignment Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Assignment Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.
-2-
| 7. | Governing Law; Jurisdiction |
This Assignment Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction. The parties hereto (i) all agree that any action, proceeding, claim or dispute arising out of, or relating in any way to, this Assignment Agreement shall be brought and enforced in the courts of New York City, in the State of New York, and irrevocably submit to such jurisdiction and venue, which jurisdiction and venue shall be exclusive and (ii) waive any objection to such exclusive jurisdiction and venue or that such courts represent an inconvenient forum.
| 8. | Notices |
All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt, or (a) personal delivery to the party to be notified, (b) when sent, if sent by electronic mail or facsimile (if any) during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next Business Day, (c) five (5) Business Days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) Business Day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next Business Day delivery, with written verification of receipt. All communications sent to PSTH shall be sent to: Pershing Square Tontine Holdings, Ltd., 787 Eleventh Avenue, 9th Floor, New York, New York 10019, Attention: Steve Milankov and emailed to milankov@persq.com, with a copy sent to the PSTH’s counsel at Sullivan & Cromwell LLP 125 Broad Street New York, NY 10004, United States of America Attention: Joseph C Shenker, Scott D Miller and Olivier de Vilmorin and emailed to shenkerj@sullcrom.com; millersc@sullcrom.com; devilmorino@sullcrom.com and Cadwalader, Wickersham & Taft LLP, 200 Liberty Street, New York, New York 10281, Attention: Stephen Fraidin, Esq. and Gregory P. Patti, Jr., Esq., and emailed to stephen.fraidin@cwt.com and greg.patti@cwt.com.
All communications to the Assignees shall be sent to the Assignees’ address as set forth on the signature page hereof (or as set forth on the applicable Joinder Agreement), or to such e-mail address, facsimile number (if any) or address as subsequently modified by written notice given in accordance with this Section 8.
[Signature Page Follows]
-3-
IN WITNESS WHEREOF, each of the parties has executed or caused this Agreement to be executed by its duly authorized representative as of the date first set forth above.
| PERSHING SQUARE TONTINE HOLDINGS, LTD. | ||
| By : | /s/ William A. Ackman | |
| Name: | William A. Ackman | |
| Title: | Chairman and Chief Executive Officer | |
| PERSHING SQUARE HOLDINGS, LTD. | ||
| By: | Pershing Square Capital Management, L.P., its Investment Manager | |
| By: | PS Management, GP, LLC, its General Partner | |
| By : | /s/ William A. Ackman | |
| Name: | William A. Ackman | |
| Title: | Managing Member | |
| Address for Notices: | 787 Eleventh Avenue, 9th Floor, | |
| New York, NY 10019 |
| PERSHING SQUARE, L.P. | ||
| By: | Pershing Square Capital Management, L.P., its Investment Manager | |
| By: | PS Management, GP, LLC, its General Partner | |
| By : | /s/ William A. Ackman | |
| Name: | William A. Ackman | |
| Title: | Managing Member | |
| Address for Notices: | 787 Eleventh Avenue, 9th Floor, | |
| New York, NY 10019 |
[Signature Page to Assignment Agreement]
| PERSHING SQUARE INTERNATIONAL, LTD. | ||
| By: | Pershing Square Capital Management, L.P., its Investment Manager | |
| By: | PS Management, GP, LLC, its General Partner | |
| By : | /s/ William A. Ackman | |
| Name: | William A. Ackman | |
| Title: | Managing Member | |
| Address for Notices: | 787 Eleventh Avenue, 9th Floor, | |
| New York, NY 10019 |
| PS VII MASTER, L.P. | ||
| By: | PS VII GP, LLC, its General Partner | |
| By : | /s/ William A. Ackman | |
| Name: | William A. Ackman | |
| Title: | Managing Member | |
| Address for Notices: | 787 Eleventh Avenue, 9th Floor, | |
| New York, NY 10019 |
[Signature Page to Assignment Agreement]
ANNEX A
JOINDER
This Joinder (this “Joinder”) is made as of the date written below by the undersigned (the “Joining Party”) in accordance with the Assignment Agreement dated as of July [●], 2021 (as the same may be amended from time to time, the “Assignment Agreement”) among Pershing Square Tontine Holdings, Ltd. a Delaware corporation, the PS Funds and any Affiliated Purchasers.
Capitalized terms used, but not defined, herein shall have the meaning ascribed to such terms in the Assignment Agreement.
The Joining Party hereby acknowledges and agrees that, by its execution of this Joinder, the Joining Party shall be deemed to be a party under the Assignment Agreement as of the date hereof and shall have all of the rights and obligations under the Assignment Agreement and under the SPA, as applicable and shall purchase Sale Shares in the amount set forth below. The Joining Party hereby ratifies, as of the date hereof, and agrees to be bound by, all of the terms, provisions and conditions contained in the Assignment Agreement and the SPA.
IN WITNESS WHEREOF, the undersigned has executed this Joinder Agreement as of the date written below.
| Date: , 2021 | ||
| [NAME OF JOINING PARTY] | ||
| By: |
| |
| Name: | ||
| Title: | ||
Address for Notices:
AGREED ON THIS [ ] day of [ ], 2021:
| PERSHING SQUARE TONTINE HOLDINGS, LTD. | ||
| By: |
| |
| Name: | ||
| Title: | ||
Percentage Share:
Sale Shares:
Purchase Price Amount:
Exhibit 10.2
INDEMNITY ASSUMPTION
This INDEMNITY ASSUMPTION (this “Assumption”) is made on July 18, 2021 by and among Pershing Square Tontine Holdings, Ltd. a Delaware corporation (“PSTH”), on the one hand, and Pershing Square Holdings, Ltd., a Guernsey limited liability company (“PSH”), Pershing Square L.P. a Delaware limited partnership (“PSLP”), Pershing Square International, Ltd, a Cayman Islands exempted company (“PSIL”) and PS VII Master, L.P. (“PSVII,” and together with PSH, PSLP and PSIL, the “PS Funds”) on the other hand and any persons or entities which become party to this agreement through execution of a joinder agreement (such persons or entities the “Affiliated Purchasers” and together with the PS Funds, the “Assignees”).
Capitalized terms used and not defined herein shall have the meanings given to them in the SPA (as defined below).
RECITALS
WHEREAS, PSTH is a party to the Share Purchase Agreement, dated June 20, 2021(the “SPA”), between PSTH and Vivendi S.E., a corporation (société européenne) incorporated under the laws of France (“Vivendi”), pursuant to which PSTH agreed to purchase and Vivendi agreed to sell 10% of the share capital and voting rights (minus one share) of Universal Music Group B.V. a private company with limited liability organized under the laws of the Netherlands (“UMG”), on a fully diluted basis (the “Sale Shares”) for an aggregate purchase price of US$ 3,949,340,400.00 (the “Purchase Price”).
WHEREAS, in connection with PSTH and Vivendi’s entry into the SPA, PSTH and Vivendi also entered into an Indemnification Agreement, dated June 20, 2021 (the “Indemnification Agreement”), pursuant to which PSTH obligated itself to indemnify and hold harmless Vivendi and certain of its affiliated persons in connection with the Warrants TO, the Redemption TO and the registration statement to register the Distribution under the Securities Act of 1933, as amended;
WHEREAS, in accordance with the terms of the SPA and as permitted thereunder, PSTH has assigned its rights under the SPA, including to purchase the Sale Shares (the “Assignment”), to the Assignees, subject to certain conditions set forth in the Assignment Agreement, dated July 18, 2021, by and among PSTH and the Assignees (the “Assignment Agreement”);
NOW, THEREFORE, in consideration of the foregoing, the mutual promises set forth hereinafter, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and with the intent to be legally bound, the Parties hereby agree as follows:
| 1. | Assignment and Assumption |
PSTH hereby assigns to the Assignees, and the Assignees hereby assumes from PSTH, severally and not jointly, PSTH’s obligations under the Indemnification Agreement, subject to the satisfaction of the conditions set forth in Section 2 of the Assignment Agreement (the “Indemnity Assumption”) and upon the Closing and purchase by the Assignees of the Sale Shares, PSTH shall be released from its obligations under the Indemnification Agreement. The extent of any Losses and payments made in respect thereof shall be allocated pro rata to each Assignee in accordance with the number of Sale Shares purchased relative to the aggregate number of Sale Shares purchased by the Assignees collectively.
Sections 3 to 8 of the Assignment Agreement are hereby incorporated into this Indemnity Assumption mutatis mutandis.
IN WITNESS WHEREOF, each of the parties has executed or caused this Indemnity Assumption to be executed by its duly authorized representative as of the date first set forth above.
| PERSHING SQUARE TONTINE HOLDINGS, LTD. | ||
| By : | /s/ William A. Ackman | |
| Name: | William A. Ackman | |
| Title: | Chairman and Chief Executive Officer | |
| PERSHING SQUARE HOLDINGS, LTD. | ||
| By: | Pershing Square Capital Management, L.P., its Investment Manager | |
| By: | PS Management, GP, LLC, its General Partner | |
| By : | /s/ William A. Ackman | |
| Name: | William A. Ackman | |
| Title: | Managing Member | |
| PERSHING SQUARE, L.P. | ||
| By: | Pershing Square Capital Management, L.P., its Investment Manager | |
| By: | PS Management, GP, LLC, its General Partner | |
| By : | /s/ William A. Ackman | |
| Name: | William A. Ackman | |
| Title: | Managing Member | |
| PERSHING SQUARE INTERNATIONAL, LTD. | ||
| By: | Pershing Square Capital Management, L.P., its Investment Manager | |
| By: | PS Management, GP, LLC, its General Partner | |
| By : | /s/ William A. Ackman | |
| Name: | William A. Ackman | |
| Title: | Managing Member | |
[Signature Page to Indemnity Assumption]
| PS VII MASTER, L.P. | ||
| By: | PS VII GP, LLC, its General Partner | |
| By : | /s/ William A. Ackman | |
| Name: | William A. Ackman | |
| Title: | Managing Member | |
[Signature Page to Indemnity Assumption]
Exhibit 99.1
Pershing Square Tontine Holdings, Ltd. Releases Letter to Shareholders
NEW YORK //- Pershing Square Tontine Holdings, Ltd. (NYSE:PSTH) CEO Bill Ackman today issued the following letter.
July 19, 2021
Dear PSTH Shareholder,
Yesterday, our board of directors unanimously determined not to proceed with the Universal Music Group transaction, and to assign our share purchase agreement to Pershing Square Holdings, Ltd. (LN:PSH) (LN:PSHD) (NA:PSH) and affiliates (“PSH and affiliates” or “Pershing Square”). Pershing Square has also agreed to assume the Vivendi indemnity agreement and our UMG transaction costs.
In light of these developments, PSTH is withdrawing its Redemption Tender Offer and related Warrant Exchange Offer.
Our decision to seek an alternative initial business combination (“IBC”) was driven by issues raised by the SEC with several elements of the proposed transaction – in particular, whether the structure of our IBC qualified under the NYSE rules.
We and our counsel had multiple discussions with the SEC attempting to change its position on the issues that it had identified. Ultimately, our board concluded that it was in the best interest of shareholders to assign the UMG stock purchase agreement to Pershing Square (which is specifically permitted under the terms of the agreement with Vivendi) as it did not believe PSTH would be able to consummate the transaction in light of the SEC’s position. Management and the board believe that greater shareholder value can be created by working expeditiously to identify a new merger partner.
PSTH has 18 months remaining to close a new transaction unless extended by the vote of our shareholders. In light of our recent experience, our next business combination will be structured as a conventional SPAC merger.
While we are disappointed with this outcome, we continue to believe that the unique scale and favorable structural features of PSTH will enable us to find a transaction that meets our standards for business quality, durable growth, and a fair price. We are highly economically and reputationally motivated to consummate a successful transaction. We will, however, only complete a deal that meets our high standards.
Our share price has fallen by 18% since the transaction was announced on June 4th. While we believe our shareholders recognize UMG’s extraordinary attributes including its attractive growth characteristics, business quality, and superb management team, we underestimated the reaction that some of our shareholders would have to the transaction’s complexity and structure. We also underestimated the transaction’s potential impact on investors who are unable to hold foreign securities, who margin their shares, or who own call options on our stock.
While management and the board clearly understood that the intricacies of our transaction structure could affect its attractiveness in the short term, we believed that substantial shareholder value would have emerged over the intermediate to long term from the sum of the parts that were created in the
transaction, namely: (1) UMG, (2) PSTH RemainCo, and (3) warrants on Pershing Square SPARC Holdings, Ltd. Furthermore, we expected that the transaction’s structural issues would largely be resolved by the end of this year.
While PSTH shareholders will not receive UMG stock, UMG will become a public company when it is listed on Euronext Amsterdam in September.
None of us anticipated this outcome. Yet, despite the inability of PSTH to consummate the UMG transaction, our counterparty was not left at the altar. Pershing Square will be fulfilling PSTH’s commitment to Vivendi. Pershing Square intends to be a long-term UMG shareholder, and will endeavor to work with UMG management to help create value for all stakeholders.
We are devoting our full resources to identifying and consummating a new transaction for the benefit of PSTH shareholders. We remain extremely grateful for your patience and support.
Sincerely,
William A. Ackman
Important Additional Information and Where to Find It
This press release does not constitute an offer to sell or buy or the solicitation of an offer to buy or sell any securities. This communication is not a recommendation to buy, sell or exchange any securities, and it is neither an offer to purchase nor a solicitation of an offer to sell securities. Information about PSTH and certain of the matters discussed in this press release is available at the SEC’s website at www.sec.gov.
Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of the federal securities laws. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this release. You should carefully consider these and the other risks and uncertainties described in PSTH’s annual report on Form 10-K and other documents PSTH has filed with the SEC. Those filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and PSTH assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. PSTH does not give any assurance that PSTH will achieve its expectations. The inclusion of any statement in this press release does not constitute an admission by PSTH or any other person that the events or circumstances described in such statement are material.
About Pershing Square Tontine Holdings, Ltd.
Pershing Square Tontine Holdings, Ltd., a Delaware corporation, is a blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with a private company. PSTH is sponsored by Pershing Square TH Sponsor, LLC (the “Sponsor”), an affiliate of Pershing Square Capital Management, L.P., a registered investment advisor with approximately $14 billion of assets under management. www.PSTontine.com
Contacts
Media Contact:
Fran McGill
212-909-2455
McGill@persq.com