Bill Ackman is eyeing another huge and potentially controversial deal

Billionaire activist investor Bill Ackman, the founder of $US19 billion Pershing Square, said it’s “very likely” that he will do another deal similar to the controversial sale of Allergan in 2014.

“What we did in Allergan was we called the question and allowed shareholders to decide what they wanted to do with the future of their business. And I think that there are acquirers who would like to — companies they would like to buy. There are transactions that don’t happen for ‘social issues’ that I think we can help catalyze,” Ackman said on CNBC’s “Squawk Box” on Friday.

“So I think it’s very likely we will partner with another strategic to make a bid for a business. We may not get it, but you know, if the outcome for shareholders is the business either improves on its own or gets sold to someone else, I think that’s a win.”

In April 2014, Ackman took a stake in pharmaceutical company Allergan and teamed up with Canadian pharmaceutical company Valeant to try and force the former to accept a takeover from the latter.

All of Ackman and Valeant’s offers for the Botox-maker were rejected.
By November 2014, Irish pharmaceutical company Actavis said it was buying Allergan in a deal valued at $US66 billion.

Even though Valeant was unsuccessful in its takeover attempt, Ackman, who had started buying Allergan’s stock in February 2014, made an estimated $US2.7 billion on his position. At the time, Ackman didn’t own any shares of Valeant.

Ackman’s pursuit of Allergan was seen as controversial. As Business Insider’s Linette Lopez wrote, it was a viewed by many as a classic “heads I win, tails you lose” situation.

Ackman earlier this year started building a stake in Valeant. He last held 19.4 million shares, a stake currently valued at about $US4.4 billion.

In 2014, Ackman was one of the best performing hedge fund managers, netting 40.4% for the year. A large part of those returns were a result of his profitable stake in Allergan.

This year is a different story for Ackman.

A volatile August completely wiped out Ackman’s gains for 2015. Pershing Square Holdings had been up more than 10.1% through the end of July. When the market tanked, his fund went down with it, dropping 13.1% from August 1 to 25. That put the fund in the red for the year, down 4.3% for 2015. Toward the end of the month, the fund pared back some of those losses and finished the month down 9.2%, leaving the fund down 0.1% for the year.

So far in September, the fund has seen gains of 0.4%, leaving the fund up 0.3% for the year. At this point, a number of the big activist funds will have to race to get back their gains for the year.

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