Howard Hughes Stock Pops on Billionaire Bill Ackman’s $85 Per Share Offer

Key Takeaways

Billionaire
Bill Ackman
’s investment firm Pershing Square has offered to buy the remainder of real estate developer Howard Hughes Holdings (

HHH

) for $85 per share, driving its stock higher.

The $85-per-share offer represented an 18% premium over Friday’s closing price of $71.78. Shares of Howard Hughes jumped 9% to $78.68 intraday Monday and are roughly flat over the past year as a result.

Ackman called Howard Hughes’ previous stock performance “extremely disappointing,” noting it has generated just a 2.2%
compound annual return
since going public in 2010.

Pershing already owned 38% of Howard Hughes as of Nov. 14, according to a
Securities and Exchange Commission
filing. To buy the remainder, Ackman proposed the creation of a Pershing Square subsidiary that would
merge
with Howard Hughes, effectively buying the remaining shares.

Current Howard Hughes investors would have the option to accept the $85 offer or roll-over their investment into the new combined company, the letter said.

While the real estate operations would remain unchanged, Ackman said his goal is to turn Howard Hughes Holdings into a “modern day
Berkshire Hathaway
(

BRK.A

;

BRK.B

).”

Howard Hughes did not immediately respond to a request for comment.

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