Ackman's $25B USA fund
Last week we discussed Bill Ackman's pricey IPO plan. The TL;DR was that Ackman was looking to take his hedge fund, Pershing Square, public in late 2025 or early 2026, and he was also actively looking to sell a stake in the firm at a $10.5 billion valuation before the IPO.
At the time, the $10.5 billion valuation for a fund with ~$18.2 billion in AUM, most of which is tied up in a closed-end fund on the European markets, felt high. For comparison, Blue Owl Capital is worth $28 billion with $174 billion in AUM.
However, we noted that this valuation could be reasonable if Pershing's AUM increased. Today, this story is beginning to make more sense. Bloomberg reported that Pershing Square is looking to raise $25 billion, up from a rumored $10 billion, for Pershing Square USA, its new NYSE-listed closed-end fund.
Assuming Pershing successfully raises $25 billion, it stands to make $500 million annually from its 2% management fee (though 20% of that would be used to reduce fees paid by its hedge fund clients). Combined with all of Pershing’s existing fees from its other investment vehicles, the extra cash it stands to generate from Pershing USA makes the $10.5 billion valuation seem far more reasonable.
However, we noted that this valuation could be reasonable if Pershing's AUM increased. Today, this story is beginning to make more sense. Bloomberg reported that Pershing Square is looking to raise $25 billion, up from a rumored $10 billion, for Pershing Square USA, its new NYSE-listed closed-end fund.
Assuming Pershing successfully raises $25 billion, it stands to make $500 million annually from its 2% management fee (though 20% of that would be used to reduce fees paid by its hedge fund clients). Combined with all of Pershing’s existing fees from its other investment vehicles, the extra cash it stands to generate from Pershing USA makes the $10.5 billion valuation seem far more reasonable.
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