Pershing Square IPO Targeted For Later This Year

Bill Ackman told investors on Wednesday that he is taking his hedge fund, Pershing Square, public.

In a letter to investors obtained by Bloomberg News, the billionaire hedge fund manager wrote that the initial public offering of Pershing Square Holdings Ltd is “targeted for later this year”.

Selling shares to the public will enable Ackman’s fund, which over the last ten years has generated net returns of 626.7%, to raise the amount of permanent capital it holds.

“Because we are an active, control and influence-oriented investor, we have avoided being fully invested because of the risk of investor redemptions,” Ackman wrote in the letter. “We will hopefully begin to address this issue with the initial public offering of Pershing Square Holdings Ltd., targeted for later this year, which will increase the amount of our capital that is permanent.”

Ackman wants to raise at least $4 billion that can’t be withdrawn by investors during difficult times. Apparently, Ackman wants to avoid a repeat of what what happened in 2009 when investors redeemed about 27% of the firm’s capital.

The letter also addresses Ackman’s Herbalife (HLF) short, saying that he may extend his $1 billion position against the nutritional products company by paying more premiums. Ackman is currently $500 million in red on his bet against Herbalife’s stock.

Read the full letter here.

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