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Bill Ackman Talks, The Timeline Reacts: What Pershing Square SPAC Is Looking At To Buy ... Maybe

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Bill Ackman Talks, The Timeline Reacts: What Pershing Square SPAC Is Looking At To Buy ... Maybe

One of the most best-known SPACs is moving higher Wednesday with Bill Ackman providing public comments on its focus and possible timeline.

What Happened: Bill Ackman spoke at “The Future of Everything” conference hosted by the Wall Street Journal. Ackman was asked about Pershing Square Tontine Holdings Ltd. (NYSE: PSTH), of which he is the chairman and CEO.

Ackman said PSTH has been working on a deal with one company dating back to November. The complexity around the deal was brought up by Ackman because of the delay in getting it done.

See also: What are the Risks of SPACs?

“We think it's worth the energy and effort,” Ackman said, adding that the target is an “iconic company.”

PSTH focuses on one transaction and remains confident it will get a deal done. There is no certainty the deal gets done until it is signed, Ackman reminded viewers, adding, “I’m cautiously optimistic.”

Ackman noted a deal could get completed in the next couple of weeks or Pershing may move onto the next target.

Related Link: Why Bill Ackman Is Swapping Starbucks For Dominos

Why It’s Important: With many of the largest SPACs and announced SPAC deals trading close to their $10 net original offering prices, PSTH still commands a pre-deal premium.

Investors have been patiently waiting to see what company Ackman acquires. In the interview, Ackman said that while a mature unicorn is a potential target, PTSH would also consider a privately owned family business or carve out an existing publicly-traded company.

The discussion of an iconic company could mean it is an older company and not a newer high-growth company like Stripe, which some have suggested.

“We’re looking for a business you could own for the next decade that would be worth multiples of the price you paid today,” Ackman said.

A couple of potential high-valued private companies that can likely be ruled out are Publix and H-E-B Grocery Co., which Ackman was asked about.

“I’m not in love with the supermarket business,” Ackman said, noting the low margins.

Ackman said he would not keep going down the list of highest-valued private companies to rule out others, which could mean there is a target on that list. The answer was to a question about Mars, Inc.

After the discussion of the PTSH SPAC, Ackman said he sold his Starbucks Corporation (NASDAQ: SBUX) stake and started a new position in Domino’s Pizza, Inc. (NYSE: DPZ).

Ackman said he likes the restaurant business and has never lost money in investments in the sector.

Subway has been mentioned as a possible target for PSTH and Ackman’s comments today don’t rule that out, although it might not be a growing brand anymore that would fit his increase in valuation over the next 10 years mentality.

PSTH Price Action: Shares of Pershing Square Tontine Holdings are up 7.64% to $24.36 Wednesday afternoon at publication.

(Photo: Bill Ackman via CNBC)

 

 

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