Pershing Square Holdings to benefit from lower fees after US IPO

Pershing Square Holdings Ltd on Friday said it stands to gain from the closing of the initial public offering of Pershing Square USA Ltd.

Pershing Square USA Ltd is a New York Stock Exchange-listed fund managed by PSH’s investment manager, Pershing Square Capital Management LP. The IPO raised $5 billion, at the bottom end of the forecast $5 billion to $10 billion range. It created two separately traded entities on the NYSE, Pershing Square USA Ltd, and Pershing Square Inc.

Shares in Pershing Square USA Ltd fell sharply on their market debut in Wednesday from the IPO price of $50 per share. They rallied on Thursday to end 4.4% higher at $42.71 in New York.

Guernsey-registered investment holding company PSH said that after the IPO its performance fees will be lowered.

The FTSE 100 listing said the fee reduction provision was adopted in an amendment to the investment management agreement in February 2024.

This supplemented an existing fee reduction provision that reduces PSH’s performance fees by an amount equal to 20% of any performance fees and allocation earned by Pershing Square from certain non-PSH funds, such as Pershing Square USA.

‘We are pleased that PSH shareholders will benefit from reduced performance fees going forward as a result of the successful completion of the IPO of PSUS, our new US listed fund,’ said Bill Ackman, chief executive of Pershing Square Inc.

Ackman said Pershing Square has the potential to serve as a platform for other new funds to be launched in the future, which could yield further reductions in PSH’s performance fees.

PSH Chair Rupert Morley said the fees generated by Pershing Square USA will enable PSH to generate ‘higher long-term returns’.

Shares in Pershing Square Holdings were 0.2% lower at 4,084.00 pence each in London on Friday morning. They are up 14% over the past year.

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