Pershing Square Revises $900 Million Proposal for Howard Hughes

2025-02-19 companies

The Woodlands, Wednesday, 19 February 2025.
Pershing Square, led by Bill Ackman, revises their offer by proposing to buy 10 million new shares of Howard Hughes Holdings, seeking to increase its stake amidst evolving market conditions.

Details of the Revised Proposal

On February 18, 2025, Pershing Square Capital Management submitted a revised proposal to acquire 10 million newly issued shares of Howard Hughes Holdings Inc. (NYSE: HHH) at $90 per share, totaling $900 million [1][3]. This new offer would increase Pershing Square’s ownership from its current 37.6% to 48% [3][7]. The proposal represents a significant shift from their January 2025 initial offer of $85 per share, which would have raised their stake to between 61% and 69% [3][4].

Leadership Changes and Management Structure

Under the proposed arrangement, Bill Ackman would assume the roles of chairman and CEO of Howard Hughes Holdings [3]. The current CEO, David O’Reilly, would transition to lead the company’s principal subsidiary, Howard Hughes Corp [3]. While Pershing Square’s management team won’t receive direct compensation, the agreement includes a 1.5% annual fee of Howard Hughes’ market capitalization, which currently stands at approximately $3.8 billion [3][7].

Market Response and Strategic Vision

Following the announcement, Howard Hughes shares experienced a 5% decline in extended trading after closing at $80.60 [4]. Ackman has outlined an ambitious vision for the company, stating that he aims to transform it into a ‘modern-day version of Berkshire Hathaway’ [4][7]. The company’s focus will remain on developing master planned communities (MPCs) such as The Woodlands in Houston and Summerlin in Las Vegas [4].

Transaction Timeline and Next Steps

The Special Committee, formed on August 8, 2024, is currently evaluating the revised proposal [1]. The transaction could be completed within weeks as it doesn’t require regulatory approvals or a shareholder vote [4]. Howard Hughes has emphasized that no stockholder action is required at this time, and there’s no assurance that the company will pursue this proposed transaction [1].

Sources

Howard Hughes Pershing Square