How Bill Ackman(@BillAckman) turned $60 million into $1.6 billion
In 2008 , Bill Ackman invested in General Growth Properties , which was then the second largest shopping mall company.
The General Growth stock price had tumbled from $64 to $0.34c . This was due to aggressive
In 2008 , Bill Ackman invested in General Growth Properties , which was then the second largest shopping mall company.
The General Growth stock price had tumbled from $64 to $0.34c . This was due to aggressive
borrowing the company participated in. During the financial crisis , the company had a lot of big maturities coming up that they could not refinance. The market noticed this and punished the stock.
General Growth had debt of $27 billion and only had a market cap of $100million
General Growth had debt of $27 billion and only had a market cap of $100million
However , the fundamentals of the business where actually doing well as both occupancy and operating income were on an upward trend . So fundamentally the business was doing well, the issue was the debt .
Bill then bought 25% of the company and tried unsuccessfully to get a
Bill then bought 25% of the company and tried unsuccessfully to get a
seat on the board. This was till he roped in a favor from Matty Buxbaum, whose cousin was the CEO and chairman.
Once on the board, Bill led a restructuring and in 8months General Growth emerged from Chapter 11 bankruptcy.
The stock went from $0.34 to $31/ share.
Once on the board, Bill led a restructuring and in 8months General Growth emerged from Chapter 11 bankruptcy.
The stock went from $0.34 to $31/ share.
As this was only 4 years into the formation of Pershing Square many of his investors doubted Bill and told him he does not know anything about distressed investing.
Bill however argued that he can read and learn about it , and he did just that .
Bill however argued that he can read and learn about it , and he did just that .
He read Bankruptcy Investing by Ben Branch
So if you too want to turn $60 million to $1.6 billion this is a good place to start. Lol
amzn.to
So if you too want to turn $60 million to $1.6 billion this is a good place to start. Lol
amzn.to
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