Billionaire investor Bill Ackman helped pressure Pornhub into taking down millions of unauthorized videos, report says

bill ackman
Bill Ackman.

  • Bill Ackman helped to pressure Pornhub into purging unauthorized videos.
  • Ackman texted then-Mastercard CEO Ajay Banga about the issue, Institutional Investor reported.
  • Mastercard and Visa swiftly cut ties with Pornhub, and the site deleted 80% of its videos.
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Billionaire investor Bill Ackman helped to pressure Pornhub into removing millions of unauthorized videos from its website, Institutional Investor reported this week.

The Pershing Square Capital Management boss was browsing Twitter last December when he came across “The Children of Pornhub,” a damning indictment of the porn site by The New York Times columnist Nicholas Kristof. The article detailed how Pornhub allowed unverified users to upload videos without authorization from the people featured in them, enabling revenge porn and other exploitation.

Ackman noted in Kristof’s story that Mastercard and Visa processed payments for Pornhub. The hedge fund manager, who has waged activist-shareholder campaigns against several companies, realized he could leverage his influence to push those publicly listed payment groups to make changes.

Unaware that American Express already banned payments on porn sites, he texted Mastercard CEO Ajay Banga a link to the story and the following message: “Amex, VISA and MasterCard should immediately withhold payments or withdraw until this is fixed. PayPal has already done so.”

Banga swiftly replied, “We’re on it,” according to Institutional Investor.

Days later, Mastercard announced it had instructed its partners who connected Pornhub to its payment network to cease accepting the site’s charges. The payments group had found evidence of illegal activity and was continuing its investigation, it said.

Visa promptly cut ties with Pornhub too and launched an investigation. The porn site declared less than 24 hours later that it had removed 10 million videos, or 80% of all the videos on its site.

MindGeek didn’t immediately respond to a request for comment from Insider.

Pornhub-owner MindGeek was already under pressure from human rights activists such as Laila Mickelwait, while litigator Michael Bowe was signaling to the credit-card companies that lawsuits might be on the way, Institutional Investor said.

However, Ackman’s text to Banga and his tweets about the issue may have tipped the balance. “It wasn’t until Bill really laid on the pressure and said, ‘Do the right thing,’ that they did,” Mickelwait told the publication.

The billionaire’s key takeaway from the episode was that investors can influence companies to act more responsibly, especially now that environmental, social, and governance (ESG) standards are gaining momentum. “CEOs get a zillion emails, but the one group that rises to the top of the line … is its biggest shareholders, influential shareholders,” he told Institutional Investor.

“A tweet can move the needle,” he added.

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Billionaire investor Bill Ackman told a story about his song-writing grandfather that won over Universal Music’s bosses

bill ackman
Bill Ackman.

  • Bill Ackman’s SPAC is close to buying 10% of Universal Music Group for $4 billion.
  • Ackman told a story about his grandfather, a songwriter, to win over UMG’s bosses.
  • UMG executives gifted Ackman two records and the sheet music for his grandfather’s hit song.
  • See more stories on Insider’s business page.

Bill Ackman’s special-purpose acquisition company (SPAC) is close to buying 10% of Universal Music Group for $4 billion. The billionaire investor might have his grandfather’s musical talents to thank if he manages to seal the deal.

The Pershing Square chief began his first meeting with UMG executives by regaling them with a story about Herman Ackman, The Wall Street Journal reported, citing people involved in the transaction.

Ackman’s grandfather wrote a song called “Put Your Arms Where They Belong (For They Belong to Me)” in 1926, which he sold to music-publishing group Tin Pan Alley for $150. The ditty sold more than 750,000 copies, Ackman told the bosses of the world’s biggest music company, according to The Journal.

The UMG executives later discovered that their company owned the elder Ackman’s recording. They dug up two records of the song and the accompanying sheet music, mounted and framed them, and gifted them to Ackman, The Journal reported.

Read more: A 29-year-old crypto billionaire shares how investors can use Tesla or Apple stock as collateral to buy bitcoin or ether

Vivendi, UMG’s parent company, met with multiple private-equity firms and other investors interested in buying a piece of the division. Ackman’s clear passion for the music business – rooted in his grandfather’s legacy – along with his relationship with management and his vision for growing the company, helped him stand out from the crowd, The Journal said.

Ackman’s SPAC, Pershing Square Tontine Holdings, is the vehicle looking to acquire the UMG stake. PSTH, which joined the stock market last summer, would remain a public company and could have nearly $3 billion to pursue another deal, even if the UMG transaction is successful.

Pershing Square also hopes to launch a new take on SPACs called a SPARC, which won’t lock up investors’ capital while it searches for a deal, and won’t have the pressure to close a deal within two years. Ackman’s proposed SPARC would be armed with up to $11 billion to pursue a business combination.

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Billionaire investor Bill Ackman’s SPAC is close to striking a deal with Universal Music, report says

bill ackman
Bill Ackman

  • Bill Ackman’s SPAC is close to striking a deal with Universal Music, The Wall Street Journal said.
  • Pershing Square Tontine Holdings could agree a transaction valuing the music group at $40 billion.
  • Universal Music, a division of Vivendi, racked up $9 billion in revenue last year.
  • See more stories on Insider’s business page.

Billionaire investor Bill Ackman’s special-purpose acquisition company (SPAC) is close to agreeing a transaction with Universal Music Group that would value the music titan at $40 billion, The Wall Street Journal reported on Thursday, citing people familiar with the matter.

Ackman’s Pershing Square Tontine Holdings might finalize the megadeal in a matter of weeks, although it could still fall through, sources told The Journal. PSTH shares fell as much as 8% in aftermarket trading after the news broke.

Universal Music, which represents artists including Taylor Swift and Billie Eilish, is currently owned by Vivendi, a French media conglomerate. The segment grew constant-currency revenue by 5% to 7.4 billion euros ($9 billion) last year, and operating income by 20% to 1.4 billion euros, Vivendi’s latest annual report shows.

Vivendi disclosed in mid-May that it was considering selling 10% of Universal Music to an “American investor” – which may be Ackman – or pursuing a public offering of 5% to 10% of the segment’s shares. Tencent, a Chinese technology conglomerate, doubled its stake in Universal Music to 20% last year, valuing the business at 30 billion euros.

Ackman, the boss of Pershing Square Capital Management, said last month that his team had identified an “iconic, phenomenal, great business” back in November 2020, and he hoped to strike a deal to purchase a piece of it within the next few weeks. He said the target was so attractive and interesting that it was “worth the energy and the effort.”

The hedge fund manager took PSTH public last summer with the goal of spending around $5 billion for a minority stake in a private business. Ackman’s reputation as a top investor – boosted by his lucrative pandemic hedge and his fund’s 70% gain last year – and the size of his SPAC prompted intense speculation about his possible target.

Pershing Square Capital Management declined a request for comment from Insider.

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Billionaire investor Bill Ackman swapped out Starbucks for Domino’s Pizza last quarter – and trimmed 5 of his 6 other holdings

Bill Ackman
Bill Ackman.

  • Bill Ackman’s hedge fund sold Starbucks and bought Domino’s Pizza last quarter.
  • The billionaire investor pounced when the pizza chain’s stock slumped in March.
  • Pershing Square trimmed its Agilent, Chipotle, Hilton, and Restaurant Brands bets.
  • See more stories on Insider’s business page.

Billionaire investor Bill Ackman swapped out Starbucks for Domino’s Pizza and trimmed all but one of the other holdings in his stock portfolio last quarter, a regulatory filing revealed this week.

Ackman’s Pershing Square Capital Management sold its almost 1% stake in Starbucks, which was worth $1.1 billion at the end of December. The hedge fund also bought more than 5% of Domino’s Pizza – a position valued at about $750 million as of March 31.

Ackman explained the move at a recent Wall Street Journal event. Starbucks stock had rebounded faster than expected, he said, while Domino’s stock slumped in March to its lowest since the pandemic tanked markets last spring.

“We’ve admired it for years, and it was just never cheap enough,” Ackman said about the pizza-delivery chain. “Then for about five minutes, it got cheap. I don’t know who sold or why, but we started buying around $330 a share, and then very quickly it moved up a lot.”

Pershing’s newest position has jumped in value by another 18% since March 31, to over $880 million as of Monday’s close.

Ackman and his team also reduced their stakes in Agilent, Lowe’s, Hilton, and Restaurant Brands by 3% to 4%, and their Chipotle stake by around 6%. In contrast, they boosted their Howard Hughes position by about 23% to 13.5 million shares.

Pershing’s stake in Lowe’s was worth $2.3 billion at the end of March, making the home-improvement retailer its most valuable holding. Its Agilent, Chipotle, Hilton, and Restaurant Brands positions were worth about $1.5 billion each, while its Howard Hughes stake was valued at $1.3 billion. The overall value of its stock portfolio grew 5% to $10.5 billion.

Ackman’s next major update could be related to his $5 billion special-purpose acquisition vehicle, Pershing Square Tontine Holdings. The investor is hoping to announce a deal to buy a minority stake in an “iconic” private business in the next few weeks.

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Billionaire investor Bill Ackman hopes to close his mega SPAC deal within weeks – and called his target an ‘iconic’ business

bill ackman
Bill Ackman.

  • Bill Ackman is hoping to close his massive SPAC deal in the next few weeks.
  • The investor trumpeted his chosen target as an “iconic, phenomenal” business.
  • Ackman’s PSTH vehicle has been working to buy a piece of it for six months.
  • See more stories on Insider’s business page.

Bill Ackman hopes to close his mammoth blank-check deal in a matter of weeks, he revealed at The Wall Street Journal’s “The Future of Everything Festival” on Wednesday.

The billionaire investor said his team has identified an “iconic, phenomenal, great business with a great management team that meets all of our criteria.” They have been working since early November to buy a piece of it, he added.

The hedge fund manager listed Pershing Square Tontine Holdings, a special-purpose acquisition company or SPAC, on the stock market last summer. Its goal is to spend about $5 billion for a minority stake in a private business and take it public.

The nature of its chosen target, the complexity of the transaction, and various other issues have delayed the process, the Pershing Square Capital Management boss said. However, he believes the company in question is so attractive and interesting that it will be “worth the energy and the effort.”

Ackman reiterated that PSTH’s goal is to buy a “super-high quality, durable, growth business.” He paraphrased a famous quote by his mentor Warren Buffett to make his point.

“What we’re looking for is a business that you can own for the next decade,” Ackman said. “The stock market could shut and you would have enormous confidence the business would be worth multiples of the price you pay today.”

Ackman now believes he’s close to securing a stake in that kind of company, but cautioned the deal could still collapse. “We’re either gonna get a transaction done in the next relative short term – weeks – or we’ll be onto the next one,” he said.

The Pershing Square chief made other notable comments at the virtual festival. His hedge fund has sold its Starbucks stake and bought about 6% of Domino’s Pizza, he revealed.

Ackman also cautioned that the recent spike in inflation might not be temporary, and predicted the Federal Reserve will raise interest rates. Moreover, he described cryptocurrencies as a “brilliant technology” but said he wasn’t comfortable owning a meaningful amount of them.

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Billionaire investor Bill Ackman warned of inflation, discussed bitcoin, and explained why he’s staying in New York City in a recent interview. Here are his 12 best quotes.

Bill Ackman
  • Bill Ackman said inflation won’t be temporary and the economy is at risk of overheating with interest rates this low.
  • The hedge fund billionaire also said cryptocurrency is “fascinating” but he’s not comfortable investing in bitcoin.
  • Ackman also revealed his fund recently acquired a 6% stake in Domino’s.
  • See more stories on Insider’s business page.

Billionaire investor Bill Ackman warned inflation may not be temporary and said the Federal Reserve may have to raise interest rates in a Wednesday interview at the Wall Street Journal Future of Everything Festival. The Pershing Square Capital Management founder also revealed that his fund recently purchased a 6% stake in Domino’s Pizza, sending the shares up as high as 5.9% Wednesday.

Here are 12 of Ackman’s best quotes from the interview, lightly edited and condensed for clarity:

1. “We’ve admired it for years, and it was just never cheap enough. And then for about five minutes, it got cheap. I don’t know who sold or why, but we started buying around $330 a share, and then very quickly it moved up a lot,” on his decision to buy a 6% stake in Domino’s pizza during the pandemic.

2. “The surprise numbers that came out are not due to any weakness in the economy. The economy is crushing it. Businesses are booming. If you think about hospitality, you can’t get a reservation in New York anymore,” on the jobs report that badly missed estimates last week.

3. “There are plenty of jobs, people haven’t had to work partially because of the stimulus…When unemployment benefits step back and some of the stimulus wears off, there will be more of a supply of labor.” He added that raising wages is good for workers and the economy because workers will spend money.

4. “They’ve got a great product, a great value where they do have pricing power. And so they’re able to offset the incremental costs of paying higher wages with charging a little bit more for a burrito. You charge 50, 60, 70 cents more for burrito, you can pay your workers more, and it’s still very good value to consumers. The key in a world where there’s going to be inflation and there’s going to be wage inflation is to have a business that sells a product where there’s pricing power,” on Chipotle raising wages. (Ackman’s Pershing Square owns Chipotle stock.)

5.”I think it’s not temporary‚Ķ.Look at every commodity price right? Copper, lumber, energy even before the colonial pipeline issue. Look at housing prices, look at Bitcoin right? Everything is inflating. That’s driven by a once in a moment history. People are emerging from a pandemic with the endless spirit that comes from being locked up,” on inflation.

6. “I think they’re going to have to raise rates for sure. And I think they adjusted their policy just at the wrong time. Preemptive policy toward inflation I think is a better approach, particularly in a world where we have massive, massive economic stimulus,” on The Federal Reserve.

7. “I think with rates where they are, there’s a very good risk of the economy overheating.”

8.”I think crypto is a fascinating phenomenon. I think it’s a brilliant technology and I kick myself for not understanding it, it’s one of the best speculations ever… But it’s not a place where I would feel comfortable personally putting any meaningful amount of assets in. Therefore I wouldn’t invest our firm’s assets.”

9.”There’s no intrinsic value. Intrinsic value to me is driven by cash generation. You have to be able to build a discounted cash flow calculation,” on why he’s not comfortable investing in bitcoin.

10. “I would be concerned if a friend had a lot of their net worth invested in, in one or more cryptocurrencies, I’d want them to take some money and put it into something a little more durable.”

11. “New York is an extremely desirable place to live. It is a big tax burden and when high-income people do the math and they say, well, I could move to Florida and buy this amazing house and not the state taxes, it motivates some people, but…One of the benefits of being successful is you can choose where you live. So to run away from a location because the tax rate is higher, it seems kind of silly,” on the migration from New York to Miami and his decision to keep Pershing Square in Manhattan.

12. “I think it’s very, very important who the next mayor of New York is, and that we actually have a pro-business mayor. The mayor of Miami has done a great job recruiting technology executives. The next mayor of New York has to do the same thing.” He added that Raymond McGuire and Andrew Yang are both great candidates for mayor.

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Billionaire investor Bill Ackman says sustained inflation could be a ‘black swan’ risk for the stock market

Bill Ackman
Bill Ackman.

Bill Ackman said in an interview with Interactive Investor published Thursday that sustained inflation could cause an unexpected tailspin in the stock market.

“I think one of the ‘black swan’-type risks for markets is a real spike in inflation that’s not just a three-month spike, that’s more sustained,” Ackman said. “Also, meaningfully higher interest rates, which I think will affect the discount rates that people use to value companies. And I think those could be countervailing stock-market forces.”

A “black swan” event is a rare and unpredictable event that could have severe consequences.

The Pershing Square Capital Management founder said that the trillions of dollars in stimulus from COVID-19 relief bills and President Joe Biden’s infrastructure proposal, historically low interest rates, and “benign policy” from the Federal Reserve would set the US up for “explosive GDP recovery and probably inflation.”

Ackman said he thought that with the pace of vaccinations, the US would be close to full employment and near all-time low unemployment rates at the start of 2022 – factors for the Fed to change policy.

“I think you could see certainly expectations change as soon as the next few months about how accommodative the Federal Reserve will be,” Ackman added.

Read more: Legendary investor Jeremy Grantham called the dot-com bubble and the 2008 financial crisis. He told us how 4 indicators had lined up for what could be ‘the biggest loss of perceived value from assets that we have ever seen.’

More investors have questioned whether inflationary pressures from the economic recovery will be temporary or have a lasting effect on markets. The Fed has signaled that it will keep its accommodative policy stance, which has long driven gains in stocks. The Fed’s chairman, Jerome Powell, has also emphasized that any rise in inflation would be transitory.

But many on Wall Street have predicted that the Fed will need to change its hand sooner than expected and that it will spook markets. The Wharton professor Jeremy Siegel told CNBC on Friday that the Fed would change its policy stance in 2021 and that it would cause a “day of reckoning” in the stock market.

Ackman recommended investors own businesses with pricing power to combat inflation.

“I think inflation is going to be real, and you’re going to see wage inflation. I mean, everywhere there are ‘help wanted’ signs. It’s very hard to hire people to fill its jobs, particularly with a stimulus package which includes extra unemployment benefits,” the investor said. “So it’s a lot of pressure on wages I think, which I think ultimately is a good thing but could have, again, depending on the nature of the business, could have a negative impact.”

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Billionaire investor Bill Ackman warns that sustained inflation could be a ‘black swan’ risk for the stock market

Bill Ackman
  • Hedge-fund billionaire Bill Ackman said a sustained rise in inflation could be a “black swan” event to markets.
  • He detailed his take in a recent interview with Interactive Investor.
  • Ackman said the US could hit full employment by the end of the year, forcing the Fed to change its policy stance.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Bill Ackman warned that sustained inflation could cause an unexpected tailspin in the stock market in an interview with Interactive Investor published Thursday.

“I think one of the ‘black swan’ type risks for markets is a real spike in inflation that’s not just a three-month spike, that’s more sustained,” Ackman said. “Also, meaningfully higher interest rates, which I think will affect the discount rates that people use to value companies, and I think those could be countervailing stock market forces.”

A “black swan” event is a rare and unpredictable event that potentially has severe consequences.

The Pershing Square Capital Management founder said the trillions of dollars of stimulus from COVID-19 relief bills and Biden’s infrastructure package, historically low interest rates, and “benign policy” from the Federal Reserve is setting the US up for “explosive GDP recovery and probably inflation.”

Ackman said that with the pace of vaccinations in the US, the country will be close to full employment and near all-time low unemployment rates at the start of 2022. Those factors are the triggers for the Federal Reserve to change policy.

“I think you could see certainly expectations change as soon as the next few months, about how accommodative the Federal Reserve will be,” Ackman added.

Ackman’s interview comes as more investors begin to question whether inflationary pressures from the economic recovery will be temporary or have a lasting effect on markets. The Federal Reserve has signaled it will keep its accommodative policy stance, which has long driven gains in stocks, in place for much longer. Chair Powell has also emphasized that any rise in inflation will be transitory.

But many on Wall Street are predicting the Fed will need to change its hand sooner than expected, and that will spook markets. On Friday, Wharton Professor Jeremy Siegel told CNBC the Federal Reserve will change its policy stance at some point in 2021, and that will cause a “day of reckoning” in the stock market.

Ackman recommended investors own businesses with pricing power to combat inflation.

“I think inflation is going to be real, and you’re going to see wage inflation. I mean, everywhere there are ‘Help Wanted’ signs, it’s very hard to hire people to fill its jobs, particularly with a stimulus package which includes extra unemployment benefits,” said the investor. “So it’s a lot of pressure on wages which I think ultimately is a good thing but could have, again, depending on the nature of the business, could have a negative impact”

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