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Ackman wants to bring a SPARC to US equity markets

By Joyanta Acharjee

15:43, 26 November 2021

Stock market charts
Stock market charts the future of corporations – Photo: Shutterstock

A buyout vehicle from activist hedge fund manager Bill Ackman filed for a public market offering on Friday.

Pershing Square SPARC Holdings (SPARC) is a new special purpose acquisition rights company and an affiliate of Pershing Square Tontine Holdings, which is listed under the PSTH ticker on the New York Stock Exchange (NYSE).

In the regulatory filing, SPARC will offer 244.4 million subscription warrants – known as SPARS – giving the holder the right to purchase SPARC common stock at a minimum price of $10 per share.

‘Novel security’

“SPARs are a novel security with unique features,” Pershing Square Tontine said in the filing.

The offering is a new way for investors to participate in Special Purpose Acquisition Company (SPAC) deals, adopting an “opt-in” structure where investors tender funds only after a proposed business combination has been identified.


2,004.85 Price
-1.180% 1D Chg, %
Long position overnight fee -0.0198%
Short position overnight fee 0.0116%
Overnight fee time 22:00 (UTC)
Spread 0.50


16,080.90 Price
+0.500% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 7.0


0.67 Price
-0.300% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 22:00 (UTC)
Spread 0.01168


44,001.35 Price
-1.350% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 22:00 (UTC)
Spread 106.00

This differs from the current “opt-out” structure used by SPACs in which investors are required to provide their capital prior to a proposed business combination having been identified, and then have a redemption right to have their money returned if they do not support the proposed transaction.

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Needs SEC’s okay

The listing will require SEC approval before the warrants can be issued and listed on the NYSE.

Ackman, who runs billion-dollar hedge fund Pershing Square Capital Management, was involved in Wendy's spinning out iconic Canadian donut and coffee chain Tim Hortons in the early 2000s and held activist shareholder positions in Canadian Pacific Rail and Choptle Mexican Grill among others.

Earlier this year Ackman's firm pulled out of a $4bn (£3bn) deal to acquire a 10% stake in Universal Music Group, home to artists such as Taylor Swift, Ariana Grande and Alicia Keys, on regulatory concerns.

Read more: Special Purpose Acquisition Company definition

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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