Billionaire investor Bill Ackman’s blank check company, Pershing Square Tontine Holdings, said Monday it had dropped a deal to buy 10% of Vivendi’s flagship Universal Music Group.

Ackmans SPAC agreed last month to buy 10% of the French media group’s crown jewel for around $ 4 billion.

Vivendi’s shareholders recently supported the spin-off from Universal, which gave the company an enterprise value of 35 billion euros ($ 41.55 billion). The music company is home to stars like Taylor Swift and Lady Gaga.

However, Pershing announced on Monday that after talks with the US Securities and Exchange Commission, its board of directors had unanimously decided not to proceed with the purchase.

“Our decision to pursue an alternative initial business combination (” IBC “) was driven by questions raised by the SEC with several elements of the proposed transaction – in particular, whether the structure of our IBC is NYSE rules,” Ackman said in a letter to shareholders, published on Monday.

Pershing Square said that, given its experience with the proposed UMG deal, it is now looking for a “conventional” SPAC merger. It has 18 months to complete a new transaction unless shareholders vote to renew.

“While we are disappointed with this result, we continue to believe that PSTH’s unique size and affordable structure will enable us to find a transaction that meets our standards of business quality, sustained growth and a fair price,” said Ackman.

Pershing’s share price has fallen 18% since the UMG purchase was announced on June 4, and Ackman said he underestimated the reaction of shareholders to the “complexity and structure” of the deal.

Despite dropping the deal, Pershing insisted that Vivendi not be “left at the altar” and reiterated that after public listing on Euronext Amsterdam in September, it still intends to become a long-term shareholder in UMG.

Vivendi announced in a statement on Monday that it had agreed to a motion by Pershing to transfer the rights to purchase 10% of UMG’s share capital to “investment funds with significant economic interests or management positions owned by Mr. William Ackman”.

“The share in UMG that was ultimately acquired will now be between 5 and 10%. If it is less than 10%, Vivendi still intends to sell the shortfall to other investors before 60% of UMG’s share capital to Vivendi’s shareholders is due to occur on September 21, 2021, “added the company.

This is a development story and will be updated shortly.