Bill Ackman pressed pause on the initial public offering of a new fund aimed at everyday investors after a lack of investor demand forced him to dramatically shrink his fundraising target.
The U-turn came after the billionaire investor spent weeks touting plans to launch “a company that will be of note in the public markets,” would hold annual meetings similar to Berkshire Hathaway’s and eventually be added to an index like the S&P 500.
Ackman originally aimed to raise around $25 billion in the offering, hoping to capitalize on his social-media celebrity, before lowering the target to around $2 billion this week.
Ackman said in a press release that he is rethinking the structure of the closed-end fund, Pershing Square USA, to address concerns from potential investors.
Many closed-end funds, which sell a fixed number of shares to the public, trade at a discount to the net value of their holdings. Ackman said that investors’ principal question was whether they would be better off waiting to invest in Pershing Square USA after it goes public under the ticker PSUS.
“This question has inspired us to reevaluate PSUS’s structure to make the IPO investment decision a straightforward one. We will report back once we are ready to launch a revised transaction.”
Read more here from the Wall Street Journal.
