Oct 2, 2023 - Economy

Bill Ackman gets SEC approval to find a "mature unicorn"

Dan Primack

Photo illustration of Bill Ackman in front of giant pile of money and a trend line — Photo illustration: Sarah Grillo/Axios. Photo: Sylvain Gaboury/Patrick McMullan via Getty Images

The U.S. Securities & Exchange Commission has approved Pershing Square SPARC Holdings, a novel investment vehicle from activist investor Bill Ackman. It's like a SPAC, except that investors have the right to know the target before they buy in.

Why it matters: Ackman finally is able to pursue "mature unicorns," more than two years after first floating the idea.

One possible target is Twitter/X, although it's highly unlikely that Elon Musk would want to take the company public yet, let alone in partnership with an activist investor.

Backstory: Ackman originally formed a traditional SPAC called Pershing Square Tontine, which raised a record $4 billion. He then agreed to buy a 10% stake in Universal Music Group from Vivendi at a $40 billion enterprise value, and said he'd form and seed the SPARC with Tontine cash not going toward the transaction.

But then the UMG deal died, with Ackman instead buying a piece of the company via his hedge fund unit.
Tontine was liquidated in mid-2022, but former unitholders will be given rights (at no cost) for the SPARC.

The bottom line: Pershing Square, as an anchor investor, would seek to invest between $250 million and $3.5 billion into a target company that itself is seeking at least $1.5 billion.

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Bill Ackman gets SEC approval to find a "mature unicorn"

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