Billionaire investor Bill Ackman has more than doubled his net worth after selling 10% of his hedge fund Pershing Square Capital Management for $1.05 billion. With this sale, Ackman’s stake in the firm is now worth around $5.25 billion, bringing his total net worth to an estimated $9.2 billion. Chief Investment Officer Ryan Israel, who owns about 10% of the firm, now also has a net worth exceeding $1 billion.
The group of investors involved in the deal includes family offices and institutions such as Arch Capital Group, Iconiq Investment Management, and Israeli insurance company Menora Mivtachim. The planned launch of a U.S.-listed closed-end fund this summer is seen as a precursor to taking Pershing Square public in late 2025 or early 2026. Ackman expressed excitement about inviting long-term partners as investors to help accelerate the firm’s growth in assets under management.
Pershing Square managed $16.3 billion in assets as of April, resulting in a valuation of 64% of its assets under management. The firm generated $155 million in management fees and $312 million in performance fees in 2023. Its performance has outperformed the S&P 500 Index, with a five-year compound annual return of 31%. The firm attributes this success to its permanent capital structure, high margins, and lean staff of only 41 employees.
Ackman’s celebrity status has also contributed to the firm’s growth prospects. With a social media platform following of 1.2 million, Ackman has been vocal on political and social issues, leveraging his influence to attract more assets and fees. Pershing Square’s concentrated stock portfolio includes major positions in companies like Chipotle, Alphabet, and Hilton. The firm has also made successful macro bets, such as credit hedges that generated profits during market downturns.
The majority of the $1.05 billion in funding from the recent sale will be invested in Pershing Square USA and other funds. The valuation will benefit all of the firm’s employee owners, including Ackman’s designated successor and CIO, Ryan Israel. While Israel has been with Pershing since 2009 and was named CIO in 2022, Ackman has no plans to step down as CEO. The firm’s annual report highlights the strength of its diverse viewpoints among employees as an asset for driving value for investors.
Pershing Square is confident that Ackman’s stature and the firm’s performance record will continue to attract assets and generate fees. The success of the firm is attributed to its permanent capital structure, high margins, and focused investment strategy. With Ackman’s influence and performance track record, Pershing Square is poised for further growth and success in the financial markets.
