🔺 What to do when markets are at an all-time high? Find smart bargains, like these.See Undervalued Stocks

Billionaire investor Ackman kicks off fundraising for new US fund

Published 07/09/2024, 04:25 PM
Updated 07/09/2024, 04:30 PM
© Reuters. FILE PHOTO: Bill Ackman, chief executive officer and portfolio manager at Pershing Square Capital Management, speaks during the SALT conference in Las Vegas, Nevada, U.S. May 18, 2017. REUTERS/Richard Brian/File Photo

By Svea Herbst-Bayliss

(Reuters) - Hedge fund manager Bill Ackman kicked off fundraising for a new U.S.-listed closed-end fund on Tuesday, an effort people familiar with the matter say could bring in as much as $20 billion, more than double his assets under management, some of that from retail investors.

Last month, Ackman sold 10% of his firm, Pershing Square Capital Management, which has posted mostly strong double digit returns since 2019 after a spell of losses.

The new fund, Pershing Square USA Ltd, will offer lower fees for investors and quicker access to capital than traditional hedge funds, regulatory filings show. There will be no management fee charged for the first year after the fund's initial public offering and no performance fees ever.

It will be listed on the New York Stock Exchange and be available to anyone who can invest in the U.S., including pension funds, endowments and retail investors. Roughly 80% is expected to be raised by institutions, with retail investors making up the rest, a filing made Tuesday shows.

Ackman, a heavy user of social media platform X, referenced the fundraising on Tuesday when he messaged his 1.3 million followers "I am going to be busy for the next few weeks. $PSUS!!"

Investors, including ones unable to write the multimillion-dollar checks Wall Street hedge funds traditionally demand, can pay $50 a share for the new vehicle. At the end of June, Pershing Square Capital Management oversaw $18.7 billion in assets, according to a company document. This includes some $15 billion in assets in Pershing Square Holdings, the 10-year old closed-end fund listed in Amsterdam and London.

Ackman built his reputation as an activist investor with noisy campaigns at companies ranging from railway Canadian Pacific (NYSE:CP) to payroll and tax services company ADP. He owned stakes in Chipotle Mexican Grill (NYSE:CMG), Hilton Worldwide Holdings (NYSE:HLT) and Restaurant Brands International (NYSE:QSR) at the end of the first quarter.

Citigroup, UBS Investment Bank, BofA Securities and Jefferies are global coordinators and bookrunners for the initial public offering.

© Reuters. FILE PHOTO: Bill Ackman, chief executive officer and portfolio manager at Pershing Square Capital Management, speaks during the SALT conference in Las Vegas, Nevada, U.S. May 18, 2017. REUTERS/Richard Brian/File Photo

Ackman's recent string of strong returns -- Pershing Square Holdings earned 27% last year, 27% in 2021, 70% in 2020 and 58% in 2019 (It dropped 8.8% in 2022 when the market tumbled) -- follow a reorganization of the firm.

Taking the advice he usually gives to companies to perform better personally, Ackman re-engineered the way he invests and reversed double-digit losses in 2015 and 2016 followed by smaller declines in 2017 and 2018.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.