Ackman Eyes Permanent Capital, Fund Listing Could Come This Year

Jun 17 2011 | 3:59am ET

Permanent capital is a hard idea for hedge fund managers to resist—and one very prominent hedge fund manager may be giving in to the temptation.

Pershing Square Capital Management's William Ackman may launch a publicly-listed version of his flagship strategy, one that would not be subject to the vicissitudes of nervous investors. Ackman, who last month was practically pining for permanent capital in his latest letter to investors, could seek to raise as much as $3 billion for the new fund, AR magazine reports.

"We have spent a few months examining alternatives for creating permanent capital for the funds," Ackman wrote. "We are closer to identifying a solution, but we have postponed pursuing such an alternative until the time is right."

Ackman is currently in talks with investors about a closed-end permanent capital vehicle, although nothing has been finalized. The activist firm could list a fund by the end of this year, although an early 2012 listing is also possible.

Brevan Howard Asset Management, CQS and Harbinger Capital Management are among the hedge funds to manage publicly-listed permanent capital vehicles. Ackman does not plan to take Pershing Square, which has $10 billion in assets under management, itself public, as Och-Ziff Capital Management and Fortress Investment Group have done.

"The only truly permanent capital today in the funds is that of our long-term employees and other affiliates, which today represents approximately 8% of our capital," Ackman explained. "If we could increase the amount of our capital that is permanent, it would enable us to be more opportunistic during times of market and investor distress, and would also enable us to take larger stakes in a greater number of holdings."


In Depth

Q&A: Jeff Eaton Talks Capital Raising, CalPERS And The Secondaries Market

Oct 14 2014 | 10:16am ET

Global placement agent Eaton Partners has raised close to $60 billion for some of...

Lifestyle

MacDonald-Korth Offers Insights Into Paintings Bought, Sold By Hedgies

Oct 7 2014 | 9:00am ET

Definitive and complete ratings require an in-person examination of an artwork,...

Guest Contributor

PAAMCO: European Equity Exposure - Challenging Year, But All is Not Lost

Oct 16 2014 | 4:12am ET

European equity hedge fund managers have had a tough time so far this year. The...

 

Videos

Editor's Note

    Must Attend Hedge Fund Charity Events For October

    Sep 30 2014 | 9:29am ET

    The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…

 

Futures Magazine

October 2014 Cover

Deeply flawed risk benchmark

Most traders agree that proper risk management is the key to successful trading. However, many traders depend on the deeply flawed measure of standard deviation as a benchmark of risk. Here we put it ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.