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Reuters – Bill Ackman, founder of the Pershing Square hedge fund, has joined the board of bankrupt shopping mall operator General Growth Properties Inc, where he is a large shareholder.
Ackman is the founder and managing member of the general partner of Pershing Square Capital Management L.P. Pershing and its affiliates own slightly less than 7.5 percent of General Growth’s outstanding common stock, the company said late on Friday.
Ackman has said he could gain 13 times his investment in the company once it is reorganized, calling General Growth "high quality."
Times and Democrat – Activist shareholder William Ackman sought for months to replace four incumbents on the Minneapolis-based retailer’s board of directors with five of his own picks, including himself.
The head of Pershing Square Capital Management, which has a 7.8 percent stake in Target, has argued that the cheap chic discount retailer, which has stumbled as shoppers focus on basics, needed new perspective. He said it especially needed to beef up its board in the areas of retail and real estate to better compete with its chief rival, Wal-Mart Stores Inc., based in Bentonville, Ark.
Shareholders rejected those arguments at their meeting outside Milwaukee Thursday. They also sided with the company in approving a measure that sets the board’s size at the current 12 members, instead of the 13 that Ackman had wanted.
Daily Times – Less than three weeks ahead of what’s expected to be a heated proxy contest at Target’s annual shareholders’ meeting, activist shareholder William Ackman aims to strengthen his case to investors for a new slate of directors by personally introducing his roster at a town hall meeting here Monday.
According to documents filed Friday with the Securities and Exchange Commission, Ackman, who runs Pershing Square Capital Management, which owns a 7.8 percent stake in the discounter, intends to “improve Target’s board and consequently, help make Target a stronger, more profitable and more valuable company.”
Reuters – The battle for board seats at Target Corp heated up on Tuesday when Pershing Square Capital Management called the current directors "suboptimal" after the retailer said the hedge fund has a "risky agenda.
The New York-based hedge fund, which owns about 7.8 percent of Target’s shares, and the Minneapolis-based retailer fired off a string of regulatory filings on Tuesday as the battle for votes intensified before the May 28 annual meeting.
New York Times – William A. Ackman makes a lot of noise for someone in the hush-hush business of hedge funds. He harangues executives, goads boards, talks this stock up and that one down — all in search of profit.
On Thursday, someone listened. After a campaign by Mr. Ackman that had lasted for months, one of the nation’s largest operators of shopping malls, General Growth Properties, filed for bankruptcy protection.
Now Mr. Ackman, who runs a hedge fund called Pershing Square Capital Management, is positioning his fund to pick up the pieces. Pershing controls 25 percent of General Growth and will play a crucial role in restructuring the company. If Mr. Ackman gets his way, he and his investors could walk off with hundreds of millions of dollars in profits.
New York (HedgeCo.Net) – Target Corp. asked shareholders yesterday to reject a proposed slate of directors nominated by Pershing Square Capital head William Ackman. Ackman’s hedge fund, who holds a 7.8 percent stake in the discount retailer, is continuing his proxy fight in an effort to boost stock prices and investor returns.
Ackman has suggested selling the land underneath Target locations, prompting the company to warn shareholders against his “risky agenda.”
“Ownership of the land under our stores and distribution centers allows Target to benefit from the value that we create on those sites, and provides necessary flexibility to make significant improvements to our stores to drive our strategy and protect our brand,” Target said in its regulatory filing yesterday.
Hedge fund Pershing Square IV, which is invested solely in Target, rose almost 50% last month after posting record losses last year. Earlier this year, Ackman told investors they could withdraw as much of their capital as they wanted, after the fund plummeted 90 percent. He threw in $25 million of his own money to help pay clients back.
On Monday, Pershing Square proposed a slate of five candidates to the board, all of whom claim to have the retail experience necessary for the company to succeed. Meanwhile, Target is hoping the shareholders will ignore the hedge fund’s advances and instead elect their proposed slate of four.
Ackman’s candidates for the board include himself, Richard Vague, a former bank executive, former Starbucks CEO Jim Donald, Ronald Gilson, a law professor, and Michael Ashner, CEO of Winthrop Realty Trust.
“We believe Pershing Square’s sizable derivative positions create an incentive to favor risk-taking to affect short-term share price performance, even if it harms Target in the long run,” Target added.
Target shares jumped 5.27 percent today in morning trading to $39.58. Shares are still recovering from their tumble in 2008, when they reached almost $60 in September.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
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New York (HedgeCo.Net) – Pershing Square Capital head William Ackman is planning to nominate himself, along with four others to the Target Corp. board of directors, in which the hedge fund holds a near 10 percent stake.
Ackman has confirmed that he is nominating former Starbucks CEO Jim Donald, Winthrop Realty Trust CEO Michael Ashner, former bank exec Richard Vague and Ronald Gilson, a professor of law at both Stanford and Columbia, to the discount retailer’s board.
Ackman has been vocal about his intent to spruce up Target’s management in an effort to boost share prices and returns for his investors, while giving the company a better chance at competing with fellow discount chain Wal-Mart.
While Target has experienced lagging stock prices and lower-than-expected sales this past year, they are “disappointed that Pershing Square has decided to pursue a costly and disruptive proxy contest, especially in light of our previous dialogue,” according to a statement. They also said they have been responsive to shareholders while partaking in discussions with the hedge fund over the last 20 months.
Ackman has already allowed investors in his Pershing Square IV Fund to withdraw their capital when the fund, which was invested solely in Target, turned out to be “one of the greatest disappointments of [his] career,” after plunging over 90 percent this year.
Ackman stated that despite the performance, he still has confidence in Target and believes that the new slate of directors will bring an experience to the board that the company is currently lacking.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds! Be sure to check out our sister sites. www.hedgefundlounge.com, www.hedgefundtools.com, and www.hedgefundemployment.com
Bloomberg – William Ackman’s hedge fund that invests solely in Target Corp. fell 33.3 percent in February, bringing the loss since inception to 93 percent, according to an e-mail sent to investors.
The decline in Pershing Square IV fund was more than three times that of Target shares in February. Ackman made his bet using options rather than the underlying stock, which can magnify gains or losses on an investment. Target tumbled about 9 percent last month.
Ackman last month told investors seeking redemptions that they would get their money back in March.
New York (HedgeCo.Net) – Hedge fund manager William Ackman of Pershing Square Capital Management is in talks with discount retailer Target to nominate some potential members to their board of directors, according to a recent Securities and Exchange Commission filing.
The hedge fund currently holds a 9.7 percent stake in the Minneapolis-based company, but has been vocal about its disappointment relating to plummeting share prices and lagging sales.
Earlier this week, Target confirmed their fourth-quarter profit fell 41 percent. Shares closed at $27.82 yesterday, a 50 percent tumble since its peak last September.
Ackman did not state how many board members he wished to nominate, or who they were. He also said he may decide to up or reduce his stake in the company, although he still believes there is plenty of potential in the retailer.
Ackman made a bold move earlier this year, when he allowed investors to withdraw as much of their capital as they liked in his Pershing Square IV Fund. The fund, which was heavily invested in Target, plunged 90 percent this year, prompting an apology to investors and a green light to clear their cash out. Ackman contributed $25 million of his personal funds to help pay back clients of the fund.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds! Be sure to check out our sister sites. www.hedgefundlounge.com, www.hedgefundtools.com, and www.hedgefundemployment.com
Birmingham Business Journal – The hedge fund created by activist investor William Ackman to buy up shares of Target Corp. lost 40.1 percent of its value in January, according to a Bloomberg News report.
Since creating the fund, called Pershing Square IV, Ackman has acquired a 9.7 percent stake in Target. He recently attempted to convince Target to spin off its real estate holdings into an investment trust. However, company officials decided not to pursue the strategy. Ackman also urged Minneapolis-based Target to sell off its credit-card receivables. It completed the sale of half of its receivables last year.
Seekingalpha.com – Bill Ackman explains how hedge funds work, specifically with regard to investors in Pershing Square IV, his fund dedicated (disastrously) to going long Target.
Some of these investors, who are for the most part other hedge funds (that comprised approximately $1.3 billion of the original $2 billion of fund capital), have told me that they previously hedged a substantial portion, or in some cases 100% or more, of their exposure to Target through PSIV.
So a bunch of hedge funds invested in PSIV to go long Target (while paying Ackman his 2-and-20), and at the same time went short Target in order to hedge their PSIV exposure. And for this piece of genius they charge their own investors 2-and-20.
New York (HedgeCo.Net) – William Ackman, who runs hedge fund Pershing Square Capital Management, is letting clients withdraw as much of their investment as they please. A vast change from the dozens of hedge funds who rushed to halt redemptions, Ackman is personally stepping up to the plate, apologizing profusely for one of his fund’s performance and allowing investors to reclaim their cash.
Pershing Square IV, the fund started by Ackman two years ago, was supposed to reap returns by betting that the stock of Target Corporation would rise sharply. Instead, share prices at the discount retailer have done just the opposite, causing the fund to plunge 90 percent this year.
Ackman sent a letter to investors, describing his fund as “one of the greatest disappointments of my career to date.” He also personally threw in $25 million to help pay back frustrated investors. For those who wish to withdrawal what is left of their investment, they will be paid in March. For clients who invest in his other hedge funds, Ackman has declared that he will not charge a performance fee until the current losses are recouped.
While Ackman’s actions are no doubt admirable, many hedge funds are choosing to go the other route; forcing investors to stay locked in until unfavorable market conditions pass. Hedge funds like RAB Capital, Citadel and Fortress have all imposed restrictions on withdrawals following losses. Some are hoping that Ackman’s moves will start a new trend; one where investors can rightfully take what’s there’s, in addition to taking the fall for disappointing investments by forgoing their standard fees.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds! Be sure to check out our sister sites. www.hedgefundlounge.com, www.hedgefundtools.com, and www.hedgefundemployment.com
