Billionaire investor Bill Ackman has provided further hints on the potential targets of his blank-check company.
Pershing Square Tontine Holdings Ltd., which had the largest initial public offering ever of a special-purpose acquisition company when it debuted in July, is not only looking at mature “unicorns” and private-equity-sponsored companies but also family-controlled and employee-owned businesses, Ackman said in an interview with Whitney Tilson.
SPACs have gained popularity this year as investors look beyond simply buying shares of publicly traded companies to reap gains. The vehicles raise money in public markets and don’t choose their target until after shares begin trading. Pershing Square Tontine units had an IPO price of $20 and closed Thursday at $22.50.
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Speaking in a video presentation from Tilson’s Empire Financial Research, Ackman said he limited the size of the SPAC because his goal is to use it for a minority interest in a large company, and if it’s too big that reduces the universe of companies with which Pershing Square Tontine could partner. There are many interesting companies in the $10 billion to $15 billion range, he said. Taking a minority interest could mean a better price, he added.
“If you’re selling 100% of your company, you want the last dollar. If you’re selling 20% of your company in a merger which enables you to take your company public but you keep control, you’re much less price sensitive,” Ackman said. “We are confident that we’re going to find a very interesting company on attractive terms.”
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