Billionaire investor Bill Ackman is making a significant move by selling a 10% stake in Pershing Square, as part of a plan to eventually take his investment firm public. The firm is currently raising $1.05 billion in a funding round, with institutional and family office investors who prefer to remain anonymous participating in the deal. This move implies a valuation of $10.5 billion for Pershing Square, according to a source familiar with the matter.
With the funding round underway, Ackman is setting his sights on an eventual initial public offering (IPO) in the U.S. Although the process has not officially started, this step marks a significant shift for the hedge-fund manager. Two years ago, Ackman appointed Ryan Israel as the chief investment officer, the first time someone else has been tasked with day-to-day investing for the firm. While Ackman remains the CEO with ultimate decision-making control, Israel is positioned as his potential successor to lead the firm.
Pershing Square currently oversees $18.6 billion in total assets under management, with a substantial portion being held in Pershing Square Holdings, a closed-end fund that is traded on European stock exchanges. Ackman’s success as a hedge-fund investor has made him a prominent figure in the financial world, known for market-topping returns and active participation in activist campaigns. Additionally, Ackman has built a significant following on social media platforms, with 1.2 million followers on X, where he comments on a range of issues from antisemitism to presidential elections.
Earlier this year, Ackman unveiled plans to launch a new investment vehicle listed on the New York Stock Exchange. This move is designed to capitalize on his substantial following among Main Street investors. The investment vehicle will be a publicly traded closed-end fund focusing on investing in 12 to 24 large-cap, investment-grade, “durable growth” companies in North America. Despite holding only six stocks at the end of March, including Alphabet, Chipotle Mexican Grill, and Hilton Hotels, Ackman’s hedge fund posted a 26.7% gain last year.
In 2022, Ackman made the decision to stop engaging in activist short selling, a practice that he had previously been involved in. This move came after a highly publicized battle against Herbalife that captured widespread attention within the financial industry. Ackman’s decision to shift his focus away from this strategy marks a notable change in his investment approach and signals a new direction for his firm’s future endeavors.
Bill Ackman’s decision to sell a 10% stake in Pershing Square and pursue an eventual IPO represents a significant development in his career as a prominent hedge-fund investor. With a strong track record of successful investments and a growing presence in the financial world, Ackman’s strategic moves continue to shape the landscape of the investment industry.