BIll Ackman said 2015 would be a year he would never forget (and he meant it in a bad way), however, 2016 so far is turning out to be an even worse nightmare the hedge fund titan. After massive losses in Valeant yesterday, Bill Ackman is now down 26.4% through March 2016. Additionally, he is selling shares of MDLZ for what he says is to reduce an outsized position. With regards to that reasoning we would like to point out that he has far more concentrated stakes in other companies including Valeant. However, it could well be that Ackman does not have as much conviction in MDLZ as he does in VRX for example. Ackman has some very sticky capital so while it is hard to determine, forced liquidation may not be the reason here.
Ackman – letter regarding MDLZ below and his latest performance numbers, below.
Pershing Square Holdings, Ltd. (ticker: PSH:NA) today released an email to investors regarding the resizing of its investment in Mondelez International. The text of the email is set forth below:
Dear Pershing Square Investor:
According to a recent interview, Corsair Capital's founder Jay Petschek did not plan to be a hedge fund manager. After holding various roles on Wall Street, Petschek decided to launch the fund in January 1991, when his family and friends were asking him to buy equities on their behalf. He realized the best structure for Read More
After the close, we completed a block sale of 20 million shares of Mondelez International. As a result of the sale, we now own a 5.6% stake in the company, are the third largest owner, and have substantial uninvested cash. We reduced our stake because Mondelez had become an outsized position in light of its initially large size and its outperformance relative to other holdings. We continue to believe in the potential for operating improvements and margin expansion that we expect will lead to substantial further increases in value. As a result, it remains our largest exposure. We are reducing the position size for portfolio management purposes only.
We have carefully reviewed the balance of our holdings and have concluded that they are appropriately sized. As such, we have no current plans to sell any of our other investments.
Please call the investor relations team or me if you have questions about the above.