- Pershing Square Capital Management plans to raise $5 billion through a closed-end fund IPO, according to people familiar with the matter.
- The vehicle, expected to list on a US exchange, targets institutional and retail investors.
- The size may shift depending on market conditions, but initial demand is strong.
IPO Details
Bill Ackman’s Pershing Square is moving forward with a $5 billion initial public offering for a new closed-end fund, sources said. The fund, which will invest in a concentrated portfolio of large-cap equities, is expected to begin trading later this year. Pershing Square has filed registration documents with the SEC, though the final size is subject to change based on investor appetite.
“We see robust interest from both institutional and high-net-worth investors,” said a person close to the process. Ackman has been marketing the offering in recent weeks, highlighting the firm’s activist track record.
The IPO, known as Pershing Square USA, Ltd., would be one of the largest closed-end fund launches in recent years. The firm previously raised $10 billion for Pershing Square Holdings in 2014, but later downsized other offerings after poor reception.
Market Context
A successful $5 billion raise would underscore strong demand for alternative asset managers. However, closed-end funds have faced headwinds, often trading at discounts. Pershing Square’s own Holdings vehicle has fluctuated. Analysts say Ackman’s reputation could buoy demand. The firm had $18.8 billion in assets as of March.
Broader Implications
Ackman’s move comes amid a resurgence in activist investing. Regulators have also scrutinized fee structures; Pershing Square’s vehicles typically charge a 1.5% management fee and 20% performance fee. The firm has attempted IPOs before, including a 2018 effort that was abandoned after investor feedback. Reached for comment, Pershing Square declined to speak beyond filings.
Correction: An earlier version misstated the target date. The fund is expected to launch in 2025, not 2024.