Universal Music Group NV on Wednesday announced plans to divest half of its stake in Spotify Technology SA, while expanding its ongoing share repurchase programme to €1 billion.

The company said it will initiate an additional €500 million buyback after concluding the €500 million programme unveiled in March.

The move follows concerns over the company’s valuation raised by billionaire investor Bill Ackman, who recently submitted an offer valuing the record label at about $65 billion.

In his proposal, Ackman said he would divest the company’s entire stake in Spotify to generate €1.5 billion ($1.75 billion) after taxes and artist payments.

Chief Executive Officer Lucian Grainge told analysts on Wednesday during an earnings call that the company would refrain from commenting on Ackman’s bid until the board concludes its review.

The Netherlands-based music company, home to artists such as Taylor Swift, Kendrick Lamar, Billie Eilish and The Beatles, said first-quarter subscription revenue climbed 12.5 per cent on a constant-currency basis to €1.3 billion, beating analyst forecasts of 10.1 per cent growth.

It attributed the increase to recent price hikes, its Streaming 2.0 strategy designed to lift average revenue per user through premium tiers and superfan monetization, and the acquisition of Downtown Music.

Overall revenue rose 8.1 per cent to €2.9 billion on a constant-currency basis.