Bill Ackman facts for kids
Quick facts for kids
Bill Ackman
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Ackman in 2016
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| Born | May 11, 1966 Chappaqua, New York, U.S.
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| Education | Harvard University (BA, MBA) |
| Occupation | Hedge fund manager |
| Title | CEO of Pershing Square Capital Management |
| Spouse(s) | |
| Children | 4 |
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William Albert Ackman (born May 11, 1966) is an American billionaire hedge fund manager who is the founder and chief executive officer of Pershing Square Capital Management, a hedge fund management company. His investment approach has made him an activist investor. As of June 2023[update], Ackman's net worth was estimated at $3.5 billion by Forbes.
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Early life and education
Ackman was raised in Chappaqua, New York, the son of Ronnie I. (née Posner) and Lawrence David Ackman, the former chairman of a New York real estate financing firm, Ackman-Ziff Real Estate Group. He is of Ashkenazi Jewish descent. In 1988, he received a Bachelor of Arts degree magna cum laude in social studies from Harvard College, in Cambridge, Massachusetts. His thesis was titled Scaling the Ivy Wall: The Jewish and Asian American Experience in Harvard Admissions. In 1992, he received a Master of Business Administration degree from Harvard Business School.
Career
Gotham Partners
In 1992, Ackman founded the investment firm Gotham Partners with fellow Harvard graduate David P. Berkowitz. The firm made small investments in public companies. In 1995, Ackman partnered with the insurance and real estate firm Leucadia National to bid for Rockefeller Center. Although they did not win the deal, the bid generated interest in Gotham from investors: three years later, Gotham had $500 million in assets under management (AUM). By 2002, Gotham had become entrenched in litigation with various external shareholders who also owned an interest in the companies in which Gotham invested.
In 2002 Ackman researched MBIA in order to challenge Standard & Poor's AAA rating of its bonds. He was charged fees for copying 725,000 pages of statements regarding the financial services company as part of his law firm's compliance with a subpoena. Ackman called for a division between MBIA's structured finance business and its municipal bond insurance business.
He argued that MBIA was legally restricted from trading billions of dollars of credit default swap (CDS) protection that MBIA had sold against various mortgage-backed collateralized debt obligations (CDOs), and was using a second corporation, LaCrosse Financial Products, which MBIA described as an "orphaned transformer". Ackman bought credit default swaps against MBIA corporate debt and sold them for a large profit during the financial crisis of 2007–2008. He reported covering his short position on MBIA on January 16, 2009, according to the 13D filed with the SEC.
In 2003, a feud developed between Ackman and Carl Icahn over a deal involving Hallwood Realty. They agreed to a "shmuck insurance" arrangement, under which, if Icahn were to sell the shares within 3 years and made a profit of 10% or more, he and Ackman would split the proceeds. Icahn paid $80 per share. In April 2004, HRPT Property Trust acquired Hallwood, paying $136.16 per share. Under the terms of the "contract", Icahn owed Ackman and his investors about $4.5 million. Icahn refused to pay. Ackman sued. Eight years later, Icahn was forced to pay the $4.5 million plus 9% interest per year, by court order.
Pershing Square Capital Management
In 2004, with $54 million from his personal funds and from his former business partner Leucadia National, Ackman started Pershing Square Capital Management.
In 2010 Pershing started buying J. C. Penney shares, paying an average of $22 for 39 million shares or 18% of J.C. Penney's stock. In August 2013, the two-year campaign to transform the department store came to an abrupt end when Ackman stepped down from the board following a disagreement with fellow board members.
In December 2012, Pershing Square Capital Management launched a new closed-end fund called Pershing Square Holdings, which raised $3 billion in an October 2014 IPO on Amsterdam's Euronext stock market. As a closed-end fund valued at $6.7 billion, PSH was designed as a permanent capital vehicle from which investors would not be able to directly withdraw funds. PSH reported 17.1% in returns since inception (December 2012–November 2017) under Ackman's management, 80% below the S&P 500.
In a statement dated August 27, 2013, Pershing Square reported that it had hired Citigroup to liquidate the 39.1 million shares the firm then owned of the Plano, Texas-based department-store chain at a price of $12.90 per share, resulting in a loss of approximately $500 million. In January 2015, LCH Investments named Ackman one of the world's top 20 hedge fund managers after Pershing Square delivered $4.5 billion in net gains for investors in 2014, bringing the fund's lifetime gains to $11.6 billion since its launch in 2004 through year-end 2014.
On April 27, 2016, Ackman, along with Valeant Pharmaceuticals' outgoing CEO, J. Michael Pearson, and the company's former interim CEO, Howard Schiller, testified before the United States Senate Special Committee on Aging. The testifying panel answered questions related to the committee's concerns about repercussions to patients and the health care system posed by Valeant's business model and controversial pricing practices. Ackman opened his testimony saying, "As a shareholder of Valeant, I recognize my investment was an… endorsement of Valeant's strategy." Ackman sold his remaining 27.2 million share position in Valeant to the investment bank Jefferies for about $300 million in March 2017. It has been estimated that the total cost of the position, including direct stock purchases and 9.1 million shares that were underlying stock options traded with Nomura Global Financial Products, was $4.6 billion, leading to a substantial loss.
Universal Music Group
In July 2021, Pershing Square and its affiliates acquired 7.1% of the share capital of Universal Music Group (UMG) from Vivendi for US$2.8 billion, corresponding to an enterprise value of €35 billion for 100% of UMG's share capital. On September 9, 2021, Pershing Square and its affiliates acquired 2.9% of the share capital of UMG for US$1.15 billion, corresponding to an enterprise value of €35 billion for 100% of UMG's share capital. Following the transaction Pershing Square held 10% of UMG's share capital. He was appointed as a non-executive director of UMG on May 12, 2022.
Netflix position
In January 2022, Ackman disclosed that Pershing Square acquired a $1.1 billion stake in Netflix. Netflix stock had just experienced a precipitous 30% selloff after announcement of a disappointing subscriber growth outlook for Q1 2022. In a letter to its investors, Ackman praised Netflix's "best-in-class management team" and said he long admired Netflix CEO Reed Hastings and the "remarkable company he and his team have built."
In April, Netflix stock fell by 35%, and Ackman responded by selling his entire stake in the company.
Philanthropy
He is a signatory of The Giving Pledge, committing himself to give away at least 50% of his wealth by the end of his life to charitable causes.
Ackman has given to charitable causes such as the Center for Jewish History, where he spearheaded a successful effort to retire $30 million in debt, personally contributing $6.8 million. The donation, along with those of Bruce Berkowitz, founder of Fairholme Capital Management, and Joseph Steinberg, president of Leucadia National, were the three largest individual gifts the center has ever received.
Ackman's foundation donated $1.1 million to the Innocence Project in New York City and Centurion Ministries in Princeton, New Jersey.
In 2006, Ackman, and then wife Karen, founded the Pershing Square Foundation to support innovation in economic development, education, healthcare, human rights, arts and urban development. Since its inception, the foundation has committed more than $400 million in grants. In 2011, the Ackmans were on The Chronicle of Philanthropy's "Philanthropy 50" list of the most generous donors.
In July 2014, Challenged Athletes Foundation, which provides sports equipment to those with physical disabilities, honored Ackman at a gala fundraiser at the Waldorf Astoria hotel in New York City for helping raise a record $2.3 million.
On March 15, 2021, he announced that he donated 26.5 million shares in South Korean e-commerce company Coupang, valued at $1.36 billion, to three entities, one of them his own foundation.
Personal life
Ackman married Karen Ann Herskovitz, a landscape architect, on July 10, 1994. They have three children. On December 22, 2016, it was reported that the couple had separated.
In 2018, Ackman became engaged to Neri Oxman. In January 2019, Oxman and Ackman married at the Central Synagogue in Manhattan, and they had their first child together in spring 2019.
Ackman is a keen amateur tennis player and controversially commented that he could play a close and even doubles match against John McEnroe when interviewed by David Rubenstein in 2020.
See also
In Spanish: Bill Ackman para niños
