Billionaire Bill Ackman is interested in striking a deal with Elon Musk’s X Corp. as part of a new investment vehicle, The Wall Street Journal reports.
Pershing Square received regulatory approval on Friday for a new investment vehicle aimed at private companies seeking to raise $1.5 billion or more and potentially take them public. The product is a new type of special purpose acquisition company, called SPARC, in which investors buy shares of the company after identifying a purchase target.
Representatives for Pershing Square and X did not immediately respond to Bloomberg’s requests for comment on Sunday.
Ackman said in an interview published by The Wall Street Journal on Sunday that X, formerly known as Twitter, would “absolutely” be one of the options he was considering. The investor told the newspaper he did not know whether the technology company was interested or whether the deal was feasible.
But X is facing a heavy debt load after Musk took the company private last year. The company still has $12.5 billion in debt and a group of seven banks is in trouble, according to Bloomberg.
Ackman’s new vehicle, called Pershing Square SPARC Holdings, could target private equity firms such as X or other private equity firms, businesses seeking initial public offerings or divisions of public companies, the Wall Street Journal reported.
In a traditional SPAC, the sponsor raises a large sum of money through a shell company’s IPO and commits to acquire a successful private company. Here, investors have the right to buy shares of the blank-check company once the target is reached. It has been announced . The billionaire has been proposing the idea for about two years and has since been waiting for approval from the U.S. Securities and Exchange Commission, which it finally received on Friday.
