Billionaire investor Bill Ackman‘s investment firm Pershing Square stated that its fund, Pershing Square USA, will offer shares at $50 each in its initial public offering (IPO) in New York.
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Details of the IPO
Ackman’s new investment portfolio will be open to all U.S. investors, including retail investors. However, the fund did not disclose the exact number of shares it will offer. Investors must buy at least 100 shares of Pershing Square USA to participate in the offering.
This new fund will mimic Ackman’s Europe-listed hedge fund, Pershing Square Holdings (LSE:PSH), but will have lower fees and offer quicker access to capital. The fund will invest in 12 to 15 large, undervalued North American companies and will charge a flat 2% management fee, which will be waived for the first year.
In June, Pershing Square Capital raised $1.05 billion by selling a 10% stake, with $500 million of the proceeds from the stake sale going to Pershing Square USA and the rest for future funds that could be launched in the future.
Is IPO ETF a Good Investment?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on Renaissance IPO ETF (NYSEARCA:IPO) shares, based on 36 Buys and six Holds assigned in the past three months, as indicated by the graphic below. After a more than 20% rally in its share price over the past year, the average IPO price target of $45.02 per share implies a 10.5% upside potential.
