Ackman’s Pershing Sued by Investors Over Howard Hughes Deal

Core Viewpoint - Pershing Square, led by Bill Ackman, is facing a shareholder lawsuit regarding a deal with Howard Hughes Holdings Inc. that allegedly disadvantaged minority investors and granted Pershing Square significant control over the company [1][2]. Group 1: Lawsuit Details - The lawsuit claims that Ackman "coerced and bullied" Howard Hughes directors into agreeing to an "unfair" deal, which included a $900 million purchase of newly-issued shares, increasing Pershing Square's stake from approximately 37% to nearly 47% [2][3]. - The deal was executed at a 48% premium to the closing share price prior to the transaction, raising concerns about its fairness for minority investors [3]. - The lawsuit alleges that Ackman threatened the board members, leading them to approve the deal without securing a control premium for minority shareholders [5]. Group 2: Strategic Intent - Ackman aimed to transform Howard Hughes into a business model similar to Berkshire Hathaway, focusing on acquiring controlling stakes in various public and private companies [4]. - The deal included provisions for Howard Hughes to pay Pershing Square a steady stream of quarterly fees and appointed Ackman as executive chairman of the board [3]. Group 3: Historical Context - Ackman's involvement with Howard Hughes dates back to his investment in General Growth Properties, which spun off Howard Hughes in 2010, and he served as chairman until stepping down in 2024 [6].