By Svea Herbst-Bayliss
April 27 (Reuters) – Billionaire hedge fund manager Bill Ackman is expected to raise $5 billion for his new closed-end fund that is part of a combined initial public offering of the alternative asset management company, sources told Reuters on Monday, making it one of the biggest initial public offerings in years and the largest-ever IPO for a closed-end fund.
Pershing Square Inc will start trading on Wednesday under the symbol PS while the closed-end fund, Pershing Square USA, will trade under the symbol PSUS. Shares in the PSUS fund were offered at $50 a share.
Ackman had initially planned to raise between $5 billion and $10 billion and then chose to keep the target at $5 billion, said the two sources who were not permitted to discuss the matter publicly.
A Pershing Square representative declined to comment.
Final orders were due at 4 p.m. Eastern Time on Monday.
Pershing Square has said that investors in the new fund will receive 1 share in Pershing Square for every 5 shares purchased in the new fund as a sweetener.
The offering was oversubscribed, with more than 85% of orders coming from institutional investors, the sources said.
The sources said $2.8 billion of the expected $5 billion will come from cornerstone investors. Their investments will be locked up for six months. These investors will receive 1.5 shares in Pershing Square for every 5 shares purchased in the new fund.
Bloomberg first reported the expected $5 billion raise.Â
Family offices, pension funds, insurers, high-net-worth investors and asset managers are vying for a piece of Ackman’s investment prowess some 22 years after he founded his hedge fund Pershing Square Capital Management in New York.
Ackman cemented his fame and fortune by launching campaigns to get prominent companies ranging from Canadian Pacific Railway to Chipotle Mexican Grill to perform better and more recently weighing in on topics including politics on social media platform X.
Pershing Square Holdings, a closed-end fund listed in London, has returned 380.4% over the last 10 years and 52.1% over the last five years.
This listing comes two years after Ackman in 2024 withdrew the IPO of Pershing Square USA days before its debut as demand was less than initially expected.
Pershing’s IPO is coming at the same time SpaceX is preparing for what could be the largest initial public offering in history and could take space exploration from a speculative venture to a mainstream investment.
The combined offering is being led by Citigroup Inc, UBS Group AG, Bank of America Corp, Jefferies Financial Group Inc, and Wells Fargo & Co.
(Reporting by Svea Herbst-Bayliss in New York and Utkarsh Shetti in Bengaluru; Editing by Shailesh Kuber and Lincoln Feast)
