[ad_1]
Bill Ackman’s call to remove Harvard University President Claudine Gay is a direct cut from the playbook of corporate raiders.
Most Read on MarketWatch
It was a natural approach for the billionaire hedge fund manager, who made a name for himself as an aggressive activist investor. For decades, he made a fortune by investing in undervalued companies, demanding change, and pushing public pressure campaigns. In many cases, he moves to oust a company’s management or board of directors.
But in Harvard’s case, Ackman used posts on X, the social media platform formerly known as Twitter, to make his case, not in filings with the Securities and Exchange Commission.
Ackman’s bare-knuckle boardroom tactics on gay issues have drawn criticism. The NAACP accused him of racism in going after the first black president of America’s oldest university. Others accuse him of getting what he wants by riding on ideological pressure from the political right, which opposes diversity, equity and inclusion policies in academia.
On Thursday, the Rev. Al Sharpton led a protest outside the offices of Mr. Ackman’s fund, Pershing Square Capital Management.
Ackman denied that racism was to blame in the anti-gay campaign, saying that efforts to put more people of color in positions of power, part of a framework known as DEI, are themselves part of a framework known as DEI. He countered that, in his view, it was racist because it discriminated against white people. Proponents of DEI initiatives say that in addition to being a smart business move, it increases the visibility of underrepresented groups in the workplace, creates a more level playing field, and fosters a greater sense of belonging. claims to promote.
In response to Gay’s resignation earlier this week, Ackman wrote in a lengthy statement: “DEI is racist because reverse racism is racism, even when it’s against white people.” wrote in the X post. “Racism against white people has come to be accepted as not racism or acceptable racism for many people.”
A spokesperson for Mr. Ackman said his comments on X speak for themselves.
Elvis of the investment world
Mr. Ackman has made a name for himself with his aggressive investment approach, building his firm into one of the nation’s most high-profile hedge funds with $18 billion in assets under management. His personal wealth is estimated to be around $4 billion, according to Forbes.
His model was to focus on a small number of stock investments, make counterintuitive bets, and then make a lot of noise, often putting himself at the center of attention. He developed a kind of personality cult among the investor class. His research on the corporate landscape is often incisive and thorough, but his activist campaigns to shake up corporate boards sometimes turn into circuses. He has been called the Elvis of the investing world.
Mr. Ackman’s fund has significantly outperformed many of its rivals and the stock market in general in recent years, making more than $2 billion in profits by shorting the market ahead of the pandemic, for example. He invested in real estate investment trust General Growth Properties in the wake of the 2008 economic crisis, giving his fund his $3.7 billion profit. His Pershing Square Holdings, as measured by the S&P 500 SPX, returned 26.7% net of fees in 2023, outperforming the U.S. stock market.
Hedge fund managers like Ackman make money by collecting performance fees, typically 20% of the annual profits generated by investments made in the market. We also often invest significant amounts of our own net assets in funds.
Mr. Ackman’s reckless approach has steered many people in the wrong direction. Ten years ago, he lost a battle over a massive $1 billion short position he had taken in the nutritional company Herbalife HLF, accusing the company of being run as a pyramid scheme, and accused the company of being run as a pyramid scheme by famous corporate raider Karl. – Confronted Icahn. Ackman lost a lot of money in disastrous activist positions at Herbalife, J.C. Penney and Valiant Pharmaceuticals.
Ackman’s hedge fund averts disaster by raising $2.7 billion in permanent capital from Ackman’s Pershing Square Holdings NL:PSH PSHZF initial public offering on the Euronext Amsterdam Stock Exchange It is possible that it did. Ackman knew the money he raised in Amsterdam in 2014 was safe when investors in Ackman’s hedge fund began withdrawing money amid losses for Herbalife, Valeant and J.C. Penney.
This wasn’t the first time Mr. Ackman had to deal with a serious threat to his business. He closed his first hedge fund, Gotham Partners, in 2002 after making a bad bet on a golf course. He launched Pershing Square Capital Management two years later.
After Herbalife’s woes, Ackman said Pershing Square has since had its best years and is taking a new, conservative approach to investing. His current portfolio includes stocks such as Google GOOG GOOGL, Chipotle Mexican Grill CMG, and Lowe’s Cos. LOW. Mr. Ackman is not publicly demanding anything from the people running these companies.
But old habits die hard.
expelled from Harvard University
Mr. Ackman, a graduate of both Harvard University and its Graduate School of Business, has been a major donor to Harvard over the years. Over the years, he has often given advice on how universities should operate and what to do with large endowments, which he said has often been ignored.
Regarding X, Ackman said he initially supported Gay becoming president of Harvard University in late 2022. But after pro-Palestinian protests erupted on Harvard’s campus in response to the Oct. 7 Hamas attack in Israel that left more than 1,200 people dead, Ackman revealed that he has strong gay feelings. He said it happened. He did not do enough to make Jewish students feel safe.
After Gay was widely criticized in Congress for answering a question about whether calls for genocide against Jews violated Harvard policy, saying it depends, Ackman became more vocal in calling for Gay’s removal. did. (Gay said in an op-ed in Wednesday’s New York Times that he had fallen into a “well-crafted trap” during the Congressional hearing.)
Gay ultimately resigned on Tuesday after an investigation into her academic work by conservative groups and media outlets revealed allegations of plagiarism.
Now, following the corporate raiders’ playbook, Harvard’s board of trustees should also resign and the DEI office should be disbanded, Ackman says.
He also focuses on Sally Kornbluth of the Massachusetts Institute of Technology, the only college president who testified at the anti-Semitism hearings in Congress to keep her job.
Meanwhile, Business Insider published a report accusing Ackman’s wife, former MIT professor Neri Oxman, of plagiarism. Oxman admitted in X In her 330-page doctoral dissertation, she writes: She regrets the error, as in her paper she did not properly place the wording in four paragraphs with quotation marks, and she also did not properly provide a quotation in another sentence. She said she was thinking about it.
opinion: Hey, billionaires, stop donating to Harvard.
Most Read on MarketWatch
[ad_2]
Source link
