SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
EXCHANGE ACT OF 1934 (Amendment No. )
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Pershing Square II, L.P.
Pershing Square IV Trade-Co, L.P.
Pershing Square IV-I Trade-Co, L.P.
Pershing Square International, Ltd.
Pershing Square International IV Trade-Co, Ltd.
Pershing Square International IV-I, Ltd.
Pershing Square Capital Management, L.P.
PS Management GP, LLC
Pershing Square GP, LLC
Pershing Square Holdings GP, LLC
William A. Ackman
Michael L. Ashner
James L. Donald
Ronald J. Gilson
Richard W. Vague
Roy J. Katzovicz
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Transcript Excerpt from an April 23, 2009 CNBC Interview with William A. Ackman
On April 23, 2009, William Ackman, the founder and managing member of the general partner of
Pershing Square Capital Management, L.P., had a television interview with CNBCs Trish Regan and
Brian Shactman. The following is a transcript excerpt from the interview:
REGAN: We have to talk about Target, when you got in at $60 a share, now trading at roughly $40,
you are the third largest shareholder, what are your plans for this company? Are you going to stay
in it and if so, what do you want to see it do?
ACKMAN: Were long term investors. We have been a shareholder of Target for two years. the
Company has an annual meeting on May 28th and there are five seats up for election. Weve put
together a collection of independent director [nominees], Im the only
Pershing Square director [nominee]. None of the
director [nominees] including myself have any affiliation with Target obviously other than our 7.8% stake in
We look at the board of Target we think its a group of outstanding business
people, but interestingly for a retailer, you would think there would be at least one retailer
independent director on the board and there isnt. You would think that there would be a credit
card expert someone with senior executive experience in the credit card industry, that is a big
important business for Target and there isnt a credit card expert on the board. There isnt a
real estate expert on the board.
REGAN: You suggested actually that they sell their credit card business?
ACKMAN: Yes, weve been a big proponent that Target is an outstanding retailer but taking the risk
associated with their credit card business is something that they dont need to do; they can still
can maintain the relationship with the customer, they can run the call center, it is completely
transparent to the customer but shifting the risk to a financial institution that has more scale,
lower cost funding, better access to capital, for that kind of asset we think is a good idea.
this proxy contest is about is not a about a specific plan, its really about putting people with
relevant expertise on the board. Weve got, I met Jim Donald six weeks ago, he has agreed to serve
on the board of the company if he is elected. He is a former CEO of Starbucks, he is the former CEO
of Pathmark, he was President of Safeway, he helped Sam Walton build Walmarts SuperWalmart
business. Target has a big food initiative, their expertise historically has not been food or the
grocery business, he is on our slate.
We have Richard Vague. Richard Vague built First USA, which
was one of the most successful credit card companies before it was sold to BankOne, and now
JPMorgan. We have a top real estate investor Michael Ashner. We have a top corporate governance
Really, what this proxy contest is about, interestingly, you look at almost every election
for corporate directors, and shareholders are given a chance to vote for the incumbent director or
to withhold their vote. They are not given the choice and what we are doing here is giving
shareholders a choice to vote for our nominees, for what we are calling The Nominees
for Shareholder Choice, and we think that Target shareholders be well served if a minority of the
board are directors with fresh perspective and expertise in the businesses that Target operates in.
SHACTMAN: Weve seen a lot of rancor from shareholders in the last week or so and we havent seen
much results in the way of the movements. Its curious, obviously the hedge fund industry is under
a lot of scrutiny right now and yourself included and people want to
know, and shareholders want to know, how long-term your interest.
Obviously you lost a fair amount of money
with this fund that is solely invested in Target. How do you convince the shareholders that youre
in long enough to be in their best interests as well?
ACKMAN: Sure, I think thats a good question. You should know that we own 24.9 million shares of
Target stock. We own it outright, we own it unleveraged, we own it in our main fund, we have been a
shareholder since April of 2007, so we have been a shareholder for
two years. We also have a $280
million investment in options in Target, those options are held in a separate fund called Pershing
Square IV, and we have investors, we have raised a pool of capital to own a levered interest in
Target. But a billion dollars of our billion and a quarter stake in the company is actually in
common stock and if you compare our common stock ownership with the directors common stock
ownership, the directors own less than 0.3% of the company.
The CEO of Target, whom I have enormous
respect for, is a terrific retailer, but even he has not had a meaningful stake in the business. He
sold $52 million worth of stock over the course of the past five years and only a day after we
launched our proxy contest did he buy stock first time in five years in the company. So we
think not only do you need experts on the board and expertise in retail and credit cards and real
estate but you want a major shareholder who will think from a major shareholder point of view.
best evidence I can give you who are long term investors in Target is that we have owned the stock
for two years, I am joining the board which is going to restrict our trading, because of the
restrictions on trading for someone who becomes an insider, clearly it is an indication that we are
committed to the business for the long term. You know there have been a couple of articles pointing
that our Pershing Square Fund IV is down a lot but actually employee stock option plans are down
probably more than the stock options that we hold in the Pershing Square IV Fund. Our options are
struck at $35 and management options are struck at an average of $43 per share.
So it is
unfortunate that employees and our Target fund has lost money but that is because the stock has
done poorly and we are going to work hard to make the stock do well and we think there is
tremendous value in the business, we think highly of management, we think highly of the existing
board in terms of the character and the business background of the people on the board, but what is
missing is shareholder ownership on the board, and some expertise in the three lines of business
that they are in.
SHACTMAN: you know its interesting Bill, in SquawkBox when you are on, they have three hours,
wed love to have more time and we appreciate your time. We do thank you for coming on. And we
appreciate your time.
ACKMAN: I appreciate the opportunity.
In connection with Targets 2009 Annual Meeting of Shareholders, Pershing Square Capital
Management, L.P. and certain of its affiliates (collectively, Pershing Square) filed a
preliminary proxy statement on Schedule 14A with the Securities and Exchange Commission (the SEC)
on April 6, 2009, which was subsequently amended on April 21, 2009. Prior to the 2009 Annual
Meeting of Shareholders, Pershing Square will furnish a definitive proxy statement to shareholders
of Target, together with a GOLD proxy card. SHAREHOLDERS OF TARGET ARE URGED TO READ THE PROXY
STATEMENT CAREFULLY BECAUSE IT CONTAINS IMPORTANT INFORMATION. Investors and shareholders will be
able to obtain free copies of the preliminary proxy statement, any amendments or supplements to the
proxy statement, and any other documents filed by Pershing Square with the SEC in connection with
the 2009 Annual Meeting of Shareholders at no charge on the SECs website at http://www.sec.gov. In
addition, shareholders will also be able to obtain free copies of the definitive proxy statement
and other relevant documents at www.TGTtownhall.com or by calling Pershing Squares proxy
solicitor, D. F. King & Co., Inc., at 1 (800) 290-6427 when they become available.
Pershing Square and certain of its members and employees and Michael L. Ashner, James L. Donald,
Ronald J. Gilson and Richard W. Vague (collectively, the Participants) are deemed to be
participants in the solicitation of proxies with respect to Pershing Squares nominees. Detailed
information regarding the names, affiliations and interests of the Participants, including by
security ownership or otherwise, is available in Pershing Squares preliminary proxy statement for
the 2009 Annual Meeting of Shareholders, as amended on April 21, 2009.
Cautionary Statement Regarding Forward-Looking Statements
transcript contains forward-looking statements. All statements contained in this transcript
that are not clearly historical in nature or that necessarily depend on future events are
forward-looking, and the words anticipate, believe, expect, estimate, plan, and similar
expressions are generally intended to identify forward-looking statements. These statements are
based on current expectations of Pershing Square and currently available information. They are not
guarantees of future performance, involve certain risks and uncertainties that are difficult to
predict and are based upon assumptions as to future events that may not prove to be accurate.
Pershing Square does not assume any obligation to update any forward-looking statements contained
in this transcript.
Pershing Square Capital Management, L.P.
William A. Ackman, (212) 813-3700