Wednesday, 1 October 2014
Last updated 15 min ago
Jul 11 2013 | 12:16pm ET
The markets are abuzz with rumors and speculation about the target of Pershing Square Capital Management's next single-company fund. But there may be less to the vehicle than Pershing Square's William Ackman hopes.
Ackman announced plans for the special-purpose vehicle—without identifying the company it would invest in—this week and said he planned to raise $1 billion for it in just 10 days. There is skepticism that he'll be able to do it, however, fueled by word that at least one major client is taking a pass on it.
"We were notified of the PS special vehicle, but will not be investing as it has a longer lock-up than what we'd like," Jason Goeller of the Public Employees Retirement Association of New Mexico told Reuters. The fund will have a three-year lockup.
Also potentially hurting the aggressive fundraising effort is the dismal performance of Pershing Square's last single-stock fund, which invested in retailer Target Corp. That fund lost 90% of its value in its first two years. Other Pershing Square single-stock funds have done better, however.
Meanwhile, Wall Street is trying to figure out exactly what company Ackman has in mind. In his letter to investors, he said only that it is a large-capitalization, investment-grade U.S. corporation operating primarily in a single business that is "simple, predictable and free-cash-flow-generative," with "high barriers to entry, high customer switching costs and substantial pricing power."
The rumor-mill has churned up FedEx Corp. and security company ADP Corp., although some FedEx analysts have cast doubt that the shipping giant fits Ackman's criteria.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
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…
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