The vocal activist investor William Ackman of Pershing Square Capital
Management LP, who is known for in-depth investor presentations
detailing his short positions primarily within the bond insurance
sector, is stepping out of character to focus on a long-term holding,
discount retailer Target Corp.
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The hedge fund manager will address a
crowd of analysts, investors and media at the the AXA Equitable
Auditorium in New York on Wednesday. And if his presentation is
anything like past speeches, the audience is in for at least an hour of
complicated and obscure financial metrics and exhaustive balance sheet
analysis that by the end will all seem to make logical sense.
While Ackman has not specified what his big plans are for Target, a
press release announcing the event said he will "detail a potential
transaction that Pershing Square believes will build long-term value
for Target Corporation ... which will be of particular interest to
investors and analysts focused on retail, real estate, fixed income and
credit."
Target may have tipped Ackman's hand. In a Monday release,
the company said that since May Pershing "has shared various ideas for
an alternative ownership structure related to Target real estate."
Target appears to be taking Ackman seriously, having hired outside
advisers, including Goldman, Sachs & Co., to evaluate its real
estate.
It may serve Target well to take Ackman seriously. Bowing
to pressure from Pershing, Target in May 2008 sold nearly half of its
credit card business to J.P. Morgan Chase & Co. for an initial
investment of $3.6 billion.
Pershing, which has held a Target stake since April 2007, currently owns roughly 9.5% of its shares. - Michael Rudnick
Michael Rudnick is a senior reporter for The Deal.
