Elliott Funding Administration focused Pershing Sq. Holdings in 2017, when Paul Singer’s agency privately tried to drive fellow activist Invoice Ackman to liquidate his listed firm.
Ackman disclosed the main points of the battle across the fund publicly for the primary time throughout a three-hour interview on the Lex Fridman Podcast. The billionaire posted the dialogue on X, the social media website previously generally known as Twitter, on Tuesday.
Elliott took a giant place in Pershing Sq. Holdings, a closed-end car that traded at a reduction to the worth of its belongings, whereas shorting the underlying securities held within the fund, Ackman stated. It was a wager that the goal can be compelled to liquidate, permitting buyers to revenue from the shakeup.
“I envisioned an end where the permanent capital vehicle ends up getting liquidated and another activist in my industry puts me out of business,” Ackman stated.
Ackman managed to fend off Elliott by snapping up shares in his personal firm, successfully shopping for management, he stated. He borrowed $300 million from JPMorgan Chase & Co., to assist him to do that.
“I give JPMorgan enormous credit in seeing through it,” Ackman stated. “It’s a handshake bank and they bet I’d succeed.”
A consultant for Elliott declined to remark.
Activist campaigns out there for closed-end funds have picked up in recent times. Companies together with Boaz Weinstein’s Saba Capital Administration have pounced on historic dislocations in these funds’ pricing and have urged asset managers to take steps like shopping for again shares or liquidating belongings to spice up valuations.
Pershing Sq. Holdings is listed on European inventory exchanges with $14 billion plus whole belongings and returned 27% in 2023. Whereas its web asset worth low cost has narrowed from 2020’s report stage, it’s nonetheless hovering round 27%.
Earlier this month, Ackman stated he plans to begin a brand new fund with an analogous construction known as Pershing Sq. USA for retail buyers.
