Bill Ackman, CEO of Pershing Square Capital Management, speaks at the Delivering Alpha conference in New York City on September 28, 2023.
Adam Jeffrey | CNBC
Billionaire investor Bill Ackman is selling a 10% stake in Pershing Square as he seeks to eventually take his investment firm public.
Ackman’s firm is raising $1.05 billion in a funding round, representing a 10% stake in the management company and valuing it at $10.5 billion, according to a person familiar with the matter. Investors in the deal include institutional and family offices, which prefer to remain anonymous, said source.
Wall Street Magazine first reported the moves. Pershing Square declined to comment.
In connection with the funding round, the hedge fund manager is considering a possible initial public offering in the United States, but he has not yet hired bankers or formally begun the process, the source said.
Two years ago, Ackman appointed Ryan Israel as chief investment officer, marking the first time the billionaire hedge fund manager appointed someone else to run the firm’s day-to-day investments. Ackman is CEO and has full control over decision-making, although he has said Israel will succeed him in running the firm. if he had been hit by a “pie truck.”
Pershing Square had total assets under management of $18.6 billion at the end of April. Most of its capital is in Pershing Square Holdings, a closed-end fund that trades on European stock exchanges.
Ackman became one of the world’s best-known hedge fund investors after years of market gains and vigorous activist campaigns. He has also built a large following on social media platform X, with 1.2 million followers, commenting on issues ranging from anti-Semitism to the presidential election.
Earlier this year, Ackman announced plans to offer a new investment vehicle listed on the New York Stock Exchange to attract a following among Main Street investors. He launches a public company closed fundinvesting in 12 to 24 large-cap, investment-grade, “long-term growth” companies in North America.
At the end of March, the popular investor’s hedge fund owned just six stocks, including Alphabet, Chipotle Mexican Grill and Hilton Hotels. Last year it showed an increase of 26.7%.
In 2022, Ackman stopped activist short selling. This practice which he engaged in led to one of the most colorful battles in Wall Street history vs Herbalife.