NEW YORK - Pershing Square Capital Management, L.P. (PSCM) has announced the sale of a 10% equity stake in its newly established Pershing Square Holdco, L.P. to a group of strategic investors for $1.05 billion. The transaction involves key financial players including Arch Capital Group Ltd. (NASDAQ:ACGL), BTG Pactual, and others.
As part of the deal, Pershing Square has formed an independent board comprising five independent directors and four PSCM affiliates. This move is concurrent with a reorganization that will see Pershing Square's voting securities indirectly owned by a limited liability company controlled by Pershing Square's senior management.
The reorganization is considered a deemed assignment under the Investment Advisers Act of 1940, necessitating the consent of the Pershing Square Holdings, Ltd. (LN:PSH) (LN:PSHD) (NA:PSH) board. The board has consented to this change, which will not affect PSCM's investment management services or its obligations under existing agreements.
Ben Hakim has been appointed as President of PSCM, while Nick Botta will take on the role of Vice Chairman and join the Pershing Square board. Major financial institutions served as placement agents for the transaction, and top-tier law firms provided legal counsel.
This strategic equity sale aims to bolster Pershing Square's growth in assets under management and comes as part of a broader reorganization designed to minimize future deemed assignments.
Pershing Square Capital Management is an SEC-registered investment advisor, and Pershing Square Holdings, Ltd. is a closed-ended investment holding company.
This news is based on a press release statement.
InvestingPro Insights
In light of Pershing Square Capital Management's recent strategic moves, a glance at the InvestingPro data reveals a steady performance for Pershing Square Holdings, Ltd. (LN:PSH) over various time frames. The stock has experienced a modest 1-week price total return of 0.04%, while the 1-month and 3-month returns have been slightly higher at 0.3% and 0.87%, respectively. Over a 6-month period, the return almost mirrors the 3-month performance with a 0.93% increase, and the year-to-date return stands at 0.57%. The consistency is further echoed in the 1-year price total return, also at 0.93%.
With the previous close at $50.38, the stability in Pershing Square's stock price could be interpreted as investor confidence in the company's strategic direction and management. Additionally, the average daily volume over the last three months has been low, which might suggest a lower trading activity and potential steadiness in the shareholder base.
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