Bill Ackman, the Donald Trump-backing money man, has asked shareholders in his Pershing Square Capital Management firm to back his new investment venture that aims to manage about $25 billion in assets.
The 58-year-old hedge fund manager, whose net worth is an estimated $9 billion, penned the letter asking to back his planned Pershing Square USA vehicle which is supposed to be listed publicly next week.
Ackman, who endorsed Donald Trump for president two weeks ago just after the attempt on the ex-commander-in-chief’s life, said shareholders should get involved in the IPO “the sooner the better” to “improve the strength” of the deal.
Since its launch two decades ago, Ackman’s hedge fund returned 16.5% a year and he recently sold a stake in the firm that valued it at more than $10 billion.
Its shareholders are largely made up of institutional investors and high-net worth individuals.
“Pershing Square has a very large global profile in the investment world. We have been able to get an audience with the senior members of the largest and most influential investors in the world including sovereigns, family offices, mutual funds, hedge funds,” he wrote.
He added that it is “very important that the banks get a sense that a deal’s momentum is building as they convey that feeling of momentum to the capital markets desks of every institutional investor, and the financial advisor community also wants to hear that the institutions are interested and motivated.”
The new company will largely mimic Pershing Square by investing in a concentrated number of large corporations, but it will be cheaper because there is no performance fee.
Pershing Square USA will be set up under what is known as a “closed-end structure”, meaning it will sell a fixed number of shares in a public offering.
Investors can get out by selling their shares to other investors at whatever their price is on the open market.
The IPO, which he originally suggested could raise as much as $25 billion, is so far on track to raise around $2.5 billion to $4 billion, according to an SEC filing that quotes Ackman’s letter.
Ackman sent the letter under the impression it wouldn’t need to be publicly disclosed, the filing said.
He also revealed the names of some of the new investors who have already expressed an interest in the planned IPO, including Baupost Group and the Teachers Retirement System of Texas
The billionaire Harvard graduate was one of the loudest voices calling for now-deposed president Claudine Gay to stand down over the anti-Semitic, pro-Hamas protests on campus earlier this year.
He rose to prominence in 2012 with a disastrous $1 billion short of Herbalife, the dietary supplements firm, with rival activist Carl Icahn taking a opposite stance on the company’s future, with the pair having an infamous row live on CNBC the following year.
