Bill Ackman’s hedge fund bets on Nike in first new investments in over a year

Billionaire investor William Ackman built new stakes in sportswear company Nike and investment management company Brookfield during the second quarter, according to a regulatory filing made on Wednesday.

This marks the first new investments for Pershing Square – which oversees roughly $17 billion in assets – since the firm put money into Google parent Alphabet during the first quarter of 2023.

The filing shows that Ackman’s hedge fund Pershing Square Capital Management owned roughly 3 million shares of Nike and 6.8 million shares of Brookfield on June 30. This amounts to a roughly 0.19% ownership of Nike and a roughly 0.34% stake in Brookfield. Nike and Brookfield did not immediately respond to requests for comment.

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Nike’s stock, which has tumbled 26% since January, rose 4% in after-market trading. Speculation had mounted hours before that an activist investor had taken a stake in the company and would begin pushing it to make improvements, some fund managers told Reuters.

The company’s sales growth has slowed as it battles competition from Adidas, On Holding and Deckers’ Hoka brand, prompting it to launch cheaper sneakers around the world while pumping up spending on marketing for the recent Olympics.

For Ackman, who cemented his fortune by pushing companies for changes, this marks a return to a company he invested in late 2017 and made a $100 million profit on.

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At that time, the investment was a rare passive one for Ackman, a passionate tennis player often photographed wearing the company’s shoes, shirts and wristbands. This time, Ackman has not said what his plans are for the investment.

A spokesman for Ackman declined to comment on what Pershing Square’s intentions were at Nike and Brookfield.

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The filing, a so-called 13F filing that shows what fund managers owned at the end of the previous quarter, also shows that Pershing Square cut its stake in long-time investment Chipotle Mexican Grill by 23% during the second quarter. On June 30, Pershing owned 28.8 million Chipotle shares.

Ackman, who had been pressing Chipotle for improvements around the time it suffered set backs from food safety issues, helped recruit Brian Niccol as CEO in 2018, paving the path to 10-fold increase in the burrito maker’s stock price. This week Niccol was poached to be Starbucks’ new CEO.

Wednesday’s filing also showed that Ackman cut his Alphabet Class C holding by roughly 20% to own 7.5 million shares and reduced his Alphabet Class A share ownership to 3.9 million, cutting it by 8.5%.

Even after Ackman declared in 2022 that he would abandon his aggressive activist agenda for a quieter investing style, he has made headlines. Last month he abruptly canceled plans for launching a super-sized investment fund aimed, in part, at retail investors in the US.

Through early August, Ackman’s Pershing Square Holdings fund lost 4.4% while the broader stock market has gained 15% since January.

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