ADVISORY BUSINESS
A. General Description of Advisory Firm.
The Adviser, Pershing Square GP, LLC, a Delaware limited liability company,
commenced operations in 2004 and has its office in New York, New York. William A. Ackman,
as the managing member and principal owner of the Adviser, controls the Adviser. Mr. Ackman
has ultimate responsibility for the management, the operations and the investment decisions
made by the Adviser.
B. Description of Advisory Services.
1. Advisory Services
The Adviser serves as the general partner for Pershing Square, L.P. (“PS LP”), an
investment partnership organized under the laws of Delaware (together with any fund sharing
substantially similar investment objectives, policies and strategies for which the Adviser may
serve as general partner from time to time, the “Funds”). Pershing Square Capital Management,
L.P., a Delaware limited partnership affiliated with the Adviser and ultimately controlled by Mr.
Ackman, serves as the management company (the “Management Company” and together with
the Adviser, the “Pershing Square Advisers”) of the Funds. The interests in PS LP are offered on
a private placement basis, in compliance with the exemption provided by Section 3(c)(7) of the
Investment Company Act of 1940, as amended (the “Company Act”), to persons who are
“accredited investors” as defined under the Securities Act of 1933, as amended (the “Securities
Act”), and “qualified purchasers” (or “knowledgeable employees”) as defined under the Company
Act, and subject to other conditions that are set forth in the offering documents for the Funds.
The Management Company is also the investment adviser to Pershing Square
International, Ltd., an investment fund organized under the laws of the Cayman Islands (“PS
Ltd”), and Pershing Square Holdings, Ltd., an investment fund organized under the laws of
Guernsey (“PSH” and collectively with PS Ltd and the Funds, the “Affiliated Funds”). The
Affiliated Funds generally implement substantially similar investment objectives, policies and
strategies. Shares in PS Ltd are offered on a private placement basis to investors that are not
“U.S. Persons,” as defined under Regulation S of the Securities Act, and U.S. investors that are
“accredited investors” and “qualified purchasers,” and subject to other conditions that are set forth
in the offering documents for PS Ltd. Shares of PSH are traded on Euronext Amsterdam and the
Main Market of the London Stock Exchange.
The Adviser and/or the Management Company may, from time to time, serve as
the general partner or investment adviser or management company for additional funds or
products, which may invest alongside the Funds (the “Other Accounts”).
As used herein, the term “client” generally refers to each of the Funds.
This brochure generally includes information about the Adviser and its
relationships with its clients and affiliates. While much of this brochure applies to all of those
clients and affiliates, there is information included herein that only applies to specific clients or
affiliates.
2. Investment Strategies and Types of Investments
The descriptions set forth in this brochure of specific advisory services that the
Adviser offers to clients, and investment strategies pursued and investments made by the Adviser
on behalf of its clients, should not be understood to limit in any way the Adviser’s investment
activities. The Adviser may offer any advisory services, engage in any investment strategy and
make any investment, including any not described in this brochure, that the Adviser considers
appropriate, subject to each client’s investment objectives and guidelines. The investment
strategies the Adviser pursues are speculative and entail substantial risks. Clients should be
prepared to bear a substantial loss of capital. There can be no assurance that the investment
objectives of any client will be achieved.
In seeking to achieve the Funds’ objectives, the Pershing Square Advisers may
use any investment strategy, long or short, in the global marketplace that they believe will
enhance overall performance and, except as described in the Funds’ offering documents, there
are no restrictions on the securities or other financial instruments that may be used by the Funds.
The Funds are authorized and are expected to invest in long and short positions in equity or debt
securities of U.S. and non-U.S. issuers (including securities convertible into equity or debt
securities); distressed securities, rights, options and warrants; bonds, notes and equity and debt
indices; swaps (including equity, foreign exchange, total return, interest rate, index, commodity
and credit-default swaps), swaptions, and other derivatives; instruments such as futures contracts,
foreign currency, forward contracts on stock indices and structured equity or fixed-income
products (including without limitation, asset-backed securities, mortgage-backed securities,
mezzanine loans, commercial loans, mortgages and bank debt); exchange-traded funds; and any
other financial instruments that the Pershing Square Advisers believe will achieve the Funds’
investment objectives. The Funds’ investments may include both publicly traded and privately
placed securities of public issuers, as well as publicly traded securities of private issuers. The
Funds also may invest in securities sold pursuant to initial public offerings. Investments in
options on financial indices may be used to establish or increase long or short positions or to
hedge the Funds’ investments. The Funds may also seek to opportunistically invest in hedges to
protect against specific macroeconomic risks and/or capitalize on market volatility.
The Funds have no overarching strategy or asset allocation model that specifies
what percentage of their portfolios should be invested in each investment category. Rather, cash,
cash equivalents, and/or securities
issued by the U.S. Department of the Treasury (“U.S.
Treasurys”) are generally the default investment choices for the Funds until the Pershing Square
Advisers identify new investment opportunities. The Funds’ allocation among different
investment categories is a function of their potential risk and reward compared with available
opportunities in the marketplace. Accordingly, the Funds may hold significant cash balances on
an ongoing basis.
The Funds will not make an initial investment in the equity of companies whose
securities are not publicly traded (i.e., private equity), but, as described above, may invest in
privately placed securities of public issuers and publicly traded securities of private issuers.
Notwithstanding the foregoing, it is possible that, in limited circumstances, public companies in
which the Funds have invested may later be taken private and the Funds may make additional
investments in the equity or debt of such companies. The Funds may make investments in the
debt securities of a private company, provided that there is an observable market price for such
debt securities.
As part of the Funds’ investment program, the Pershing Square Advisers intend to
concentrate the Funds’ assets in a relatively limited number of investments because the Pershing
Square Advisers believe that (1) there are a limited number of attractive investments available in
the marketplace at any one time, and (2) investing in a relatively modest number of attractive
investments about which it has detailed knowledge provides a better opportunity to deliver
superior risk-adjusted returns when compared with a large diversified portfolio of investments it
can know less well. As a result, the Pershing Square Advisers intend to invest the substantial
majority of the Funds’ capital in typically 8 to 12 core investments.
The Pershing Square Advisers generally do not believe in the use of a material
amount of margin leverage because of the potential risk of forced sales at inferior prices in the
event of short-term declines in security prices in a margined portfolio. In certain circumstances,
the Funds may use derivatives, including equity options, in order to obtain security-specific, non-
recourse leverage in an effort to reduce the capital commitment to a specific investment, while
potentially enhancing the returns on the capital invested in that investment, or for other reasons.
The Funds may also use derivatives, such as equity and credit derivatives and put options, to
achieve a synthetic short position in a company without exposing the Funds to some of the
typical risks of short selling which include the possibility of unlimited losses and the risks
associated with maintaining a stock borrow. The Funds generally do not use total return swaps
to obtain leverage, but rather to manage regulatory, tax, legal or other issues. However,
depending on the investment strategies employed by the Funds and specific market
opportunities, the Funds may use other derivatives for leverage.
The Management Company also formed Pershing Square SPARC Holdings, Ltd.
(“SPARC”), a Delaware corporation, for the purpose of effecting a merger, capital stock
exchange, asset acquisition, stock purchase, reorganization or similar business combination with
one or more businesses. SPARC’s initial Form S-1 Registration Statement was filed with the
SEC on November 26, 2021 and became effective on September 29, 2023 (the “SPARC
Prospectus”). Pershing Square SPARC Sponsor, LLC (“SPARC Sponsor”), a Delaware limited
liability company, is the sponsor entity of SPARC. The Affiliated Funds wholly own SPARC
Sponsor as non-managing members and are the only source of funding for SPARC Sponsor. The
business and affairs of SPARC Sponsor are managed exclusively by the Management Company,
its non-member manager. SPARC distributed, at no cost, subscription warrants (“SPARS”) to
purchase SPARC Public Shares (defined below) at a future date to former Pershing Square
Tontine Holdings, Ltd. (“PSTH”) security holders who owned either Class A Common Stock
(ticker: PSTH) or PSTH warrants (ticker: PSTH.WS) as of the close of business on July 25, 2022
(the last date on which such instruments could have been redeemed or cancelled): one SPAR for
every four shares of PSTH common stock and one SPAR for every two PSTH warrants. After
SPARC has entered into a definitive agreement for its business combination and distributed to
SPAR holders a prospectus, included in an effective registration statement that describes the
proposed business combination, SPAR holders may elect to exercise their SPARs. SPARC
intends that, at the time during which a holder may elect to exercise, the SPARs will be quoted
on the OTCQX marketplace of the OTC Markets Group or other quotation service. The shares
issuable upon the exercise of the SPARs (the “SPARC Public Shares”) will be issued
concurrently with the closing of SPARC’s business combination. The SPARC Prospectus is
available on the SEC’s website.
C. Availability of Customized Services for Individual Clients.
The Pershing Square Advisers intend for the Funds and Other Accounts sharing a
similar investment strategy (if any) to generally hold, to the extent practicable, similar securities
and other financial instruments on a proportionate basis relative to each Fund’s or Other
Account’s respective Adjusted Net Asset Values (as defined in Item 11.B.1. (Cross Trades)
below), although, due to liquidity needs and tax, regulatory and other considerations, the Funds’
and any such Other Accounts’ investments may differ significantly. Adjusted Net Asset Value
may also vary over time as a result of capital appreciation, negative returns, subscriptions or
redemptions (where applicable), among other factors.
D. Regulatory Assets Under Management.
The Adviser managed approximately $1,445,867,557 as of March 1, 2024 on a
discretionary basis. As of March 1, 2024, the Adviser does not manage any assets on a non-
discretionary basis.