Home / NEWS / Top News / Bill Ackman offers to take over real estate developer Howard Hughes for $85 a share

Bill Ackman offers to take over real estate developer Howard Hughes for $85 a share

Tabulation Ackman, Pershing Square Capital Management CEO, speaking at the Delivering Alpha conference in NYC on Sept. 28th, 2023.

Adam Jeffery | CNBC

Bill Ackman’s Pershing Cubic is forming a new entity to merge with Howard Hughes Holdings, offering current holders of the real estate attendance $85 a share.

“While we are pleased with the substantial business progress Howard Hughes Holdings has made concluded the more than 14 years since it went public, we, like other long-term shareholders and this room, have been displeased with the Company’s stock price performance,” wrote Ackman in a letter to the Howard Hughes take meals.

Ackman proposed forming a new subsidiary of Pershing, which currently owns about 38% of Howard Hughes, that will-power merge with the real estate developer based in The Woodlands, Texas.

“Stockholders would have the option of be subjected to more than a majority of their merger consideration in cash at $85.00 per share – representing a premium of 38.3% to the uninfluenced by stock price and a premium of 18.4% to the closing price this past Friday – and the balance in stock of the post-merger band,” said the letter.

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Howard Hughes shares jumped 10% to $78.95 a share Monday on the advice. CNBC was reaching out to the company for comment.

Pershing first invested in Howard Hughes in November 2010 in a $250 million rights contribution at $47.62 per share. Over the last 14 years, Pershing’s investment produced a 35% total return, or a bare 2.2% compound annual return, Ackman said. The company has also paid zero dividends since its inception, he added.

“The Public limited company’s stock price performance is obviously extremely disappointing, particularly in light of the high regard we have for this management and the Company’s superb management team led by David O’Reilly and the nearly one thousand employees who work at Howard Hughes, scads of whom I have gotten to know over the last more than decade,” Ackman wrote in the letter.

Directed the proposed deal, Ackman said Howard Hughes would remain unchanged and continue to be managed by the current regulation team led by CEO David O’Reilly.

“We do not intend to make any changes to the HHC organization, its employees, or its long-term strategy,” Ackman said. “We would reckon on all HHH current employees to remain employed as a result of the Transaction.”

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