- Pershing Square Capital founder Bill Ackman filed with US regulators for an initial public offering of a colossal buyout vehicle, CNBC reported Thursday.
- The billionaire investor plans to raise at least $1 billion in the IPO, potentially creating the biggest-ever special-purpose acquisition company.
- Such firms raise capital from investors for takeovers. Some of the year’s most popular SPAC deals include electric-truck manufacturer Nikola and sports-betting platform DraftKings.
- It’s not yet known which company Ackman may target, and that information can remain confidential even as investors participate in the IPO.
- Visit the Business Insider homepage for more stories.
Hedge fund billionaire Bill Ackman filed with US regulators to take a record-size acquisition company public, CNBC reported Thursday.
The Pershing Square Capital founder aims to raise at least $1 billion in the initial public offering, likely forming the largest-ever “blank check” firm. The current record is held by former Citigroup executive Michael Klein, whose Churchill Capital raised $1.1 billion earlier in 2020.
Known on Wall Street as special-purpose acquisition companies, such vehicles are used to raise funds in an IPO for buyouts. It’s not yet known which firms Ackman may target, and such information can be kept confidential even to investors participating in the IPO.
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Ackman plans to work with Citigroup, Jefferies, and UBS on the IPO, according to CNBC.
The upcoming offering isn’t Ackman’s first foray into SPACs. The billionaire investor co-sponsored Justice Holding, an acquisition company used to buy out Burger King for $1.4 billion in 2012.
The unique investment vehicles have surged in popularity in 2020, raising $9.8 billion through their IPOs in the year-to-date, CNBC reported, citing SPAC Research. Such offerings brought in $13.6 billion through the entirety of 2019. Some of the biggest SPAC listings in 2020 so far include electric-truck company Nikola and sports-betting platform DraftKings.
Ackman’s latest move follows major wins throughout the year despite historic market turbulence. Pershing Square’s main fund is up 33% since January, CNBC reported. The gains were largely driven by a now-famous bet against credit health. When Ackman saw the coronavirus pandemic posing a significant threat to corporate credit health in March, he piled $27 million into credit-protection assets. As virus-related lockdowns curbed spending and market functioning slumped, the investment ballooned to a $2.6 billion windfall.
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