00:00It's a day that's been years in the making for Bill Ackman and his hedge fund Pershing Square.
00:04Pershing has raised a $5 billion for a U.S. dual IPO in pursuit of a Warren Buffett investing
00:11powerhouse. And for our radio and TV listeners, I want to welcome Pershing Square CEO and founder
00:16Bill Ackman. Bill, thank you so much for stopping by today. Of course, thank you. So as I mentioned,
00:20this has been years in the making, at least two years. It's had fits and starts much like this
00:24American IPO market itself. What was it like to get this over the line? It's great. It's a great
00:30day. But it's really, you know, it's the beginning, right? The beginning of a journey. So it's the
00:35beginning of a journey and now armed with $5 billion. How quickly can you put that to work?
00:40Actually, we think it's a very good time to put the capital to work. And we invest in the most
00:43liquid companies in the world. So it's really, it's weeks, not months. So it's weeks. But there's
00:47this question. So some of the companies that you own in your other portfolio, for example,
00:51example, Uber, Meta, they've had a good run, and you're already very long them. So the question
00:57might arise, is now the right time to be doubling down? Actually, I think the companies you mentioned
01:02are very cheap stocks today. Interestingly, some of the best businesses in the world are trading at
01:06the lowest multiples. They've traded that in some cases in history. Actually, those multiples bottomed
01:10maybe two weeks ago. So we're a little bit off the all-time bottom. But, you know, very bullish on
01:14the economy. And, you know, there are some amazing businesses available at really cheap prices.
01:19This will be kind of a continuation of what we're doing now. So we're going to just add to
01:25existing positions, which will give us more ownership. And in our strategy, we like to be a
01:28big, big shareholder. As you said, very liquid stocks. So the market is there. What about for
01:33like a Fannie or Freddie, where they trade OTC? How does that work? How do you dive back in without
01:37moving the market? We're going to be very thoughtful about the way we deploy the capital. We're not going
01:42to tell anyone on TV what we're going to do. I see. You don't want to front run anyone,
01:46perhaps a wise decision. And look, you've discussed, you were talking about it earlier
01:51this morning on CNBC, that closed-end funds, they trade at a discount to NAV. That's not a
01:56surprise. So what does success look like in this scenario? Is, for example, like a 10 percent
02:00discount? Okay. So I want to give you a new construct to think about. Please. Okay. So there's
02:06hundreds of closed-end funds, but they're a very different animal from what we're doing here. We're
02:11adopting the closed-end structure, the legal structure, the corporate structure, because it's the
02:15most flexible and most tax-efficient corporate structure in America. It's never been used for
02:20the purpose that we're going to use it for. And if you think about our business as a business,
02:24think of us as an investment holding company. It's a business that's earned a 19 percent return
02:28on equity for the last 22 years. If you look in Bloomberg, someone should do a search real time.
02:33Find me a business that's earned 19 percent on equity for the last 22 years that trades for less
02:37than two times book value. And we're taking the company public at book value. So we think that's
02:42going to be a cheap price. Now, the nature of IPOs are such that in the first couple of days,
02:46I can't tell you exactly what's going to happen. But over time, we're going to compound this book
02:51value or NAV, as some people call it. If we do anything like what we've done in the past,
02:55a high rate over time, and it's going to compound and it's going to grow. And we're going to run
02:59it
02:59like a real company. Closed-end funds are kind of a backwater. No one actually wakes up and gets
03:05excited about investing in a closed-end, a traditional closed-end IPO. They're kind of generic. You don't know
03:09who runs them. I bet Bloomberg's never even run a story. And they don't have conference calls with
03:15their shareholders. They don't have particularly distinguished boards of directors. If this were
03:20a C-Corp, no one would be asking me whether it should trade at a discount or not. But we
03:24can't
03:25deploy our strategy in a C-Corp, which is why we've chosen this structure. And it's more tax efficient
03:31than a C-Corp. It's a flow-through entity for tax purposes. So more tax efficient. And then we fix
03:36the
03:36things that are problematic about closed-end funds. So it's the lowest cost compensation for
03:40a management firm like us to manage this pool of assets. In fact, we charge our other funds
03:45incentive fees. We don't do so here. We're not permitted to do so here. So it's the lowest cost
03:49version of Pershing Square. You take our record over the last eight years since we've had permanent
03:53capital, it's been a 24.9% return. That's a very high rate of return relative even to the stock
03:59market,
03:59which is about 10% per annum, not as well. So it's a liquid way to invest in Pershing
04:06Square at very low cost. And we're going to build the value of this entity over decades.
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