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Billionaire investor Bill Ackman starts fundraising for new US fund

Hedge fund manager Bill Ackman began raising funds in the U.S. on Tuesday for an initial public offering of a closed-end fund. The effort could raise $20 billion, more than double Mr. Ackman’s assets under management, some of it from individual investors, according to people familiar with the matter.

Last month, Ackman sold a 10% stake in his firm, Pershing Square Capital Management, which has delivered strong nearly double-digit returns since 2019 after a string of losses.

The new fund, called Pershing Square USA, will offer investors lower fees and faster access to capital than traditional hedge funds, according to regulatory filings. It will not charge management fees for one year after the fund’s initial public offering and will not impose any performance fees.

The bonds will be listed on the New York Stock Exchange and available to anyone who can invest in the U.S., including pension funds, endowments and individual investors. About 80% of the offering will be raised by institutional investors, with the rest coming from individual investors, according to documents filed Tuesday.

Bill Ackman considers Pershing Square IPO

Pershing Square founder Bill Ackman has begun fundraising for a new U.S.-listed fund that could raise more than $20 billion. (Scott Eales/Bloomberg via Getty Images/Getty Images)

Ackman, a heavy user of the social media platform X, mentioned the fundraiser in a message to his 1.3 million followers on Tuesday, saying, “The next few weeks are going to be busy. PSUS!!”

Investors, including those who can’t afford to write the multimillion-dollar checks that Wall Street hedge funds traditionally require, can put money into the new product for $50 a share. As of the end of June, Pershing Square Capital Management had $18.7 billion in assets under management, according to company documents. That includes about $15 billion in assets from Pershing Square Holdings, a 10-year-old closed-end fund listed in Amsterdam and London.

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Bill Ackman of California

Bill Ackman sold his 10% stake in Pershing Square Capital Management. (Michael Bezian/Brand Innovators/Courtesy of Getty Images)

Mr. Ackman, who built a reputation as an activist investor with high-profile campaigns on companies ranging from Canadian Pacific Railway Co. to payroll and tax services company ADP Co., held shares in Chipotle Mexican Grill Inc., Hilton Worldwide Holdings Inc. and Restaurant Brands International Inc. as of the end of the first quarter.

Citigroup, UBS Investment Bank, Banc of America Securities and Jefferies are acting as global coordinators and bookrunners for the IPO.

Ackman’s recent strong returns — Pershing Square Holdings returned 27% last year, 27% in 2021, 70% in 2020 and 58% in 2019 (and fell 8.8% in 2022 when the market crashed) — are due to his restructuring of the company.

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Mr. Ackman has applied the advice he normally gives to companies to improve their performance, overhauling his investment approach and helping the company recover from double-digit losses in 2015 and 2016 and then limit its stock price to smaller declines in 2017 and 2018.

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