Bill Ackman, also known as William Albert Ackman, is an American hedge fund manager, investor, and philanthropist. He created and currently heads Pershing Square Capital Management, a company that manages hedge funds. He started his career in real estate, working for his father at “Ackman Brothers & Singer Inc.” after receiving his MBA from “Harvard Business School.” Later, he and David P. Berkowitz established the investing company “Gotham Partners.” He ventured back into the hedge-fund industry after the collapse of “Gotham,” a company that made modest investments in public firms and established the hedge-fund management firm “Pershing Square Capital Management” in 2004. The company’s total assets were worth $12.4 billion as of December 2015. Additionally, he oversees the sizable 2012-founded British investment trust “Pershing Square Holdings.” He describes himself as an activist investor, yet his style of investing has drawn both praise and criticism. He is best recognized as a contrarian investor. His market activities include acquiring stakes in “Chipotle Mexican Grill,” “Valeant Pharmaceuticals,” and “Target Corporation,” holding a $1 billion short position against “Herbalife,” growing to be CPR’s largest shareholder and engaging it in a proxy fight and shorting MBIA bonds in 2008 during the financial crisis.
Early Childhood & Life
Lawrence David Ackman and Ronnie I. (née Posner) Ackman welcomed him into the world on May 11, 1966. They were a wealthy Jewish family. His father was the chairman of the New York-based “Ackman-Ziff Real Estate Group,” which provided financing for real estate.
Ackman was raised in Westchester County, New York, in Chappaqua. He attended “Harvard College,” where he graduated with a BA in history in 1988. He wrote extensively about Harvard’s admissions procedures in his honors thesis, “Scaling the Ivy Wall: The Jewish and Asian American Experience in Harvard Admissions.”
He continued his education at the “Harvard Business School,” where he graduated with an MBA in 1992.
Career of Bill Ackman
He started his career in real estate by working for his father at Ackman Brothers & Singer Inc., a commercial real estate mortgage agency in New York, where he later served as chairman.
He founded “Gotham Partners” in 1992 with David P. Berkowitz, a fellow Harvard student, as an investment company that made modest investments in publicly traded firms. From 1993 through 2003, he worked as a co-investment manager for Gotham LP, Gotham III LP, and Gotham Partners International.
In 1995, he teamed forces with the American conglomerate and investment holding company “Leucadia National” based in New York City to submit a proposal for “Rockefeller Center.” Despite the fact that the purchase did not go through, this action caught investors’ attention and led them to “Gotham Partners.” As a result, the company gathered an impressive clientele, which helped it amass assets worth $500 million by 1998.
By 2002, “Gotham Partners” was heavily embroiled in legal disputes, and many persons owned holdings in the businesses that “Gotham” had also invested in. Due to poor debts, Ackman was forced to finally liquidate the company’s assets in 2003.
While the State of New York and federal authorities were looking into Ackman’s trading, he started a research project in 2002 that was aimed at questioning the AAA rating of the financial services business “MBIA.” He was fined for copying 725,000 pages of financial services company statements in his law firm’s effort to comply with a subpoena.
He argued that “MBIA” was prohibited by law from trading “credit default swap” (CDS) protection worth billions of dollars that the financial services firm had sold against various mortgage-backed “collateralized debt obligations” (CDOs) through a different company called “LaCrosse Financial Products,” which was referred to by “MBIA” as an “orphaned transformer.”
As soon as the “MBIA” crashed during the 2008 financial crisis, he bought “CDS” against the company’s corporate debts. He then made a fortune by selling the swaps. He reportedly tried to warn rating agencies, regulators, and investors about the high-risk business strategies of “MBIA.” Reporter Christine Richard from “Bloomberg News” authored a book named “Confidence Game” about Ackman’s conflict with “MBIA.”
In 2003, he got into a fight over a deal involving “Hallwood Realty” with an American businessman, investor, and philanthropist Carl Icahn. After eight years, a lawsuit resulting from the dispute was resolved in Ackman’s favor. Icahn was ordered by the court to pay Ackman $9 million.
With US$54 million, he started the American hedge fund management firm “Pershing Square Capital Management” in 2004. He and his former business partner, “Leucadia National,” provided the company with funding.
CEO and portfolio manager of “Pershing,” a company that makes investments in public equities markets all around the world using long and short strategies, is Ackman.
Pershing pushed Wendy’s International to sell its doughnut business, Tim Hortons, by buying a sizable portion of Wendy’s International’s stock. Wendy’s handed off the Tim Hortons franchise through an IPO in September 2006, generating US$ 670 million for Wendy’s investors. Ackman sold his shares as a result of disagreements over managerial succession, making a sizeable profit while also causing a significant drop in the value of the company’s stock.
Pershing now owns 7.8% of Target Corporation after purchasing a 10% investment in the company in December 2007. In December 2010, his funds owned a 38% stake in the “Borders Group.”
On January 9, 2009, the fund management company said that it has a 7.4% investment in “General Growth Properties” (GGP), making it the company with the second-largest stake after “Brookfield Asset Management.”
Pershing started purchasing CPR shares in 2011 and disclosed on October 28 of that same year that it owned 12.2% of the company in a 13D regulatory filing. The investment management company then expanded its stake in “CPR” to 14.2%, making it the corporation with the greatest ownership. Then, after engaging in a proxy battle with the railroad corporation, Ackman proposed that CPR’s CEO, Fred Green, be replaced. As a result, on June 29, 2012, E. Hunter Harrison was appointed as CPR’s new CEO.
Other “Pershing” investments include sizeable ownership shares in “J.C. Penney” in 2010 and a 1% stake in “Procter & Gamble,” which decreased by late 2013. In September 2016, “Pershing” also purchased a 9.9% share in “Chipotle Mexican Grill.”
Additionally, Ackman oversees the assets of “Pershing Square Holdings,” a British investment trust that Pershing established in December 2012. It invests for the long term in North American businesses.
‘Pershing’ acquired a $1 billion short position in ‘Herbalife,’ a company that creates and sells dietary supplements and nutritional products. Ackman quickly produced a research study in December 2012 that criticized the corporation’s multi-level marketing business model and called it a “pyramid scheme.”
Although “Herbalife” refuted these claims, the “US Federal Trade Commission” and the state of Illinois launched an investigation against the company in March 2014. Ackman launched a $50 million public relations offensive against the company in that year.
In July 2016, “Herbalife” and the “US Federal Trade Commission” reached a settlement in which the former agreed to change its business strategy and the latter agreed to reimburse its distributors $200 million.
He supported Michael Bloomberg as a probable presidential candidate for the US election for president in 2016. He is renowned for giving generously to Democratic causes and politicians, including Robert Menendez and Richard Blumenthal, as well as to Democratic groups like the Democratic Senatorial Campaign Committee.
Individual Life of Bill Ackman
He wed Karen Ann Herskovitz, a landscape architect, on July 10, 1994. He and Karen had three kids. 2017 saw the couple’s divorce.
Ackman is well renowned for his charitable endeavors. He has personally given the “Center for Jewish History” US$ 6.8 million, and his foundation has given US$ 1.1 million to the “Innocence Project” in New York City and “Centurion Ministries” in Princeton, NJ. He pledged to give at least half of his money to charitable causes as one of the signatories of the “The Giving Pledge” initiative.
Bill Ackman’s Net Worth
Ackman, Bill Bill Ackman, a hedge fund manager and philanthropist from the United States, is worth $2.3 billion. He is better recognized as the founder and CEO of Pershing Square Capital Management LP, also known as William Ackman (a hedge fund management company).