Market Data 
By Svea Herbst-Bayliss
(Reuters) -Billionaire investor Bill Ackman scrapped the launch of Pershing Square USA on Wednesday, days before the fund was slated to begin trading on the New York Stock Exchange.
Ackman downsized the initial public offering (IPO) plans just a day earlier for the second time in a week, having seen at least one prominent pledged investor back out and undergoing a fresh bout of regulatory scrutiny.
On social media platform X, where Ackman has 1.3 million followers, the investor released a four-paragraph statement saying his team had reevaluated the fund’s structure.
“We will report back once we are ready to launch a revised transaction,” he wrote.
A spokesman for Ackman had no additional comment.
Hours later, Ackman posted again saying he “made the decision to withdraw the IPO (on Wednesday morning) when (he) came up with a better transaction structure.”
Closed-end funds have lost popularity as they often trade at a discount to the securities they hold. None were launched last year and only six were launched in 2022, industry data showed.
Ackman unveiled plans in February for a cheaper fund mimicking investments of his hedge fund for U.S.-based investors including retail customers. People familiar with the matter said the fund could raise as much as $25 billion in assets, setting up one of the biggest IPO in years.
That would have more than doubled the $19 billion in assets Ackman’s New York-based Pershing Square Capital Management oversees.
Potential investors raised concern about the fund’s structure, where the new cash would be invested at a time the market was storming higher and who would be doing the investing.
By last week, Ackman told investors in his management company that the fund would be capped at $10 billion and, by Tuesday, he said he expected to raise around $2 billion.
“While we have received enormous investor interest in PSUS (Pershing Square USA), one principal question has remained. Would investors be better served waiting to invest in the aftermarket than in the IPO?” Ackman wrote in his first post on Wednesday.
Ackman has held dozens of meetings in recent weeks with top hedge and mutual funds and said there had been considerable interest in the new vehicle – the first planned since raising $2.9 billion for Pershing Square Holdings, a closed-end fund listed in Amsterdam a decade ago.
He acknowledged that Pershing Square USA’s structure had raised concern because such vehicles often trade at a discount or premium to assets held. He said his firm committed $500 million as an anchor investment to what he called a U.S.-listed investment holding company.
Last week, Ackman sent a letter to investors in his management company updating them on the listing process and asking them to chip in money. He also listed committed investors, including Boston-based hedge fund Baupost Group.
While the letter was intended to be private, it was filed with regulators late last week and contributed to a delay in the expected start of trading.
Baupost, run by Seth Klarman and noted for staying out of the headlines, decided against participating, spooking other would-be investors, people familiar with the matter said.
