The planned launch of Pershing Square USA (PSUS) – which at one stage Bill Ackmann was saying could raise $25bn – has been pulled after failing to attract sufficient investor interest. The target size of the IPO has been steadily shrinking – most recently to $2bn – but a cornerstone investor is said to have pulled out at the last minute.
This is bad news for investors in the London-listed vehicle, who had been hoping for a fee reduction (there was a planned offset of fees on PSUS against performance fees on PSH). We were also fairly sure that there was a plan to reduce PSH’s outsized bet on Universal Music with a sale of some of the position to PSUS. That is moot anyway as Universal Music’s value has already crashed (from a share price of around €28 to around €21) following a disappointing second-quarter update.
With less firepower to support a deal, there will also need to be a rethink about what sort of business Pershing Square Tontine Holdings could acquire. Any deal may be on the back burner for now.
Notwithstanding all of this bad news, Pershing Square Holdings shareholders have had a great run over the past year, with the shares up almost 30% even after the recent Universal related pullback.
PSH : Pershing Square USA launch flops
