PYMNTS-MonitorEdge-May-2024

SPAC Investor Ackman In Limited Talks With Stripe For IPO

Billionaire investor Bill Ackman said he’s had preliminary discussions with Airbnb and Stripe, among others, about helping them to go public, Bloomberg reported.

The process would involve them going through a merger with Ackman’s blank-check company.

Airbnb didn’t get anywhere with Ackman before the popular home vacation rental app ended up seeking a traditional initial public offering (IPO), which it said it ultimately preferred to Ackman’s method — although it hasn’t ruled out a merger with Ackman’s Pershing Square Tontine company, which is what has been termed a special purpose acquisition company (SPAC). SPACs raise money publicly in order to make a purchase within a set period of time, often around two years.

Ackman, speaking with Bloomberg TV, said the talks with Airbnb had been primarily informal.

“We did not discuss valuation, and we didn’t get to do a deep enough dive, frankly, to determine whether this is a business that we’d want to own and what price we’d like to own it at,” Ackman said, according to Bloomberg. “We like the company — at least from the outside in terms of the nature of the business.”

In terms of Stripe, Ackman said the company isn’t “mature enough” to go public, according to the Bloomberg report.

Ackman raised $4 billion for Pershing Square Tontine in July and had $5 billion in total capital ready to deploy. He said he thought his most likely space to find a target is in private equity-backed FinTechs, Bloomberg reported.

Airbnb’s denial of Ackman’s SPAC could have come from several avenues, PYMNTS reported, including the nature of a SPAC in which the blank-check company doesn’t identify what it’s backing until the IPO comes out. Airbnb entering into that agreement could involve it giving up some control of operations, and it wouldn’t have the same say over its own goals.

And while Ackman’s $5 billion value isn’t small, Airbnb already had a valuation of around $18 billion as of its last fundraising. So, the vacation rental company’s decision to go for a traditional IPO shows a confidence in its standing, PYMNTS reported.

PYMNTS-MonitorEdge-May-2024