Bill Ackman of Pershing Square Capital Management

Molecular Millionaire: Bill Ackman of Pershing Square Capital Management

William Albert Ackman (Bill) is an American investor, hedge fund manager, and philanthropist. His current net worth stands at $1.4 billion…

Dr. Clemen Chiang 25.Jan.2018

William Albert Ackman (Bill) is an American investor, hedge fund manager, and philanthropist. His current net worth stands at $1.4 billion. His career and reputation have seen him being described as a ‘Contrarian Investor’, one that seems to purchase and sell stocks and shares against the trend at the time of transaction.

Ackman graduated from Harvard in 1988 with a ‘magna cum laude’ degree in history. He went on to study further at Harvard, and was awarded an MBA from the business school in 1992.

Later in 1992, Ackman and fellow Harvard graduate David P. Berkowitz founded the investment firm Gotham Partners. Gotham partners primarily made small investments in public companies. In 1995, Ackman partnered up with insurance and real estate firm Leucadia National in order to bid for the Rockefeller Centre. Although this bid was unsuccessful, the hype generated by Ackman’s bid caused a spike in interest in Gotham Partners from investors. This eventually led Gotham Partners to $500 million in assets by 1998. The company Gotham Partners would eventually close in 2001 following years of controversy, closely covered by the media.

In 2004, using $54 million from his personal funds and from former partner Leucadia International, Ackman started up Pershing Square Capital Management. This company has had a lot of media attention, launching activist campaigns against McDonald’s, Wendy’s and Herbalife.

Ackman has an unequivocal belief that Herbalife is nothing more than a pyramid scheme that will shortly go bust. His public rhetoric against Herbalife CEO Michael Johnson and investor Carl Icahn would eventually be the basis of an award-winning documentary titled ‘Betting on Zero’.

In 2005, Pershing Square Capital Management raised $670 million for Wendy’s food chain investors after purchasing a significant share in the fast food chain and pressurising it to sell off its Tim Horton’s donut chain. By 2007 Ackman’s funds owned a 10% stake in the Target corporation, valued at $4.2 billion. In 2010, Ackman’s funds had now purchased a 38% stake in the Borders Group and were financing a buyout of Barnes and Noble for $900 million.

Later in 2010 Ackman started to purchase shares in J.C Penney, this was the beginning of a two-year bid to transform the department store. This came to an abrupt end in 2012, when Ackman stepped down after an argument with fellow board members. The following year saw Pershing Square lost $500 million after hiring Citigroup to liquidate J.C Penney.

Ackman started working with Valeant Pharmaceuticals in 2014 after becoming very enthusiastic with the company’s business model. This would eventually become both Ackman and Pershing Square Capital’s biggest financial loss, losing a total of $4 billion over a two-year period.

Ackman called his decision to invest in Valeant a “Very big mistake”, this mistake led to losses in Pershing Square’s main hedge fund by 16.7% in 2015 and 10.2% in 2016.

In his personal life, Ackman is a philanthropist. He contributed $6.8 million towards the Centre for Jewish History in a successful effort to help them retire their $30 million of debt. His foundation donated $1.1 million to the Innocence Project in NYC and Centurion Ministries in New Jersey. In July 2014 Ackman helped to raise a record $2.3 million for the Challenged Athletes Foundation, a foundation which helps to provide sports equipment to those with physical disabilities.

You can track the Portfolio of Bill Ackman on the US stock market at https://spiking.com/v/billackman.

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