The Self-Proclaimed Cultists Obsessed With Bill Ackman’s SPAC Think a Deal Is Near — But They’ve Been Wrong Before

As retail investors parse the manager’s statements, Pershing Square chalks a solid April gain.

Bill Ackman (Scott Eells/Bloomberg)

Bill Ackman

(Scott Eells/Bloomberg)

Some self-professed cultists investing in Bill Ackman’s SPAC, Pershing Square Tontine Holdings, now are betting on a deal announcement by mid-May.

These retail investors, posting on the Reddit forum r/PSTH, call it “hopium” — and it’s just the latest speculation from those who’ve been trying to time the deal, as well as figure out which company will be the SPAC’s merger partner.

The new speculation is based on an April 29 video interview with Ackman on “The Interactive Investor,” a British retail platform, in which the hedge fund manager said that Pershing Square Holdings, his UK-listed hedge fund, had sold its stake in Starbucks about a month ago and was replacing it with “a new investment we haven’t disclosed. You’ll will see the beginnings of disclosure of that probably with a filing we will make in mid-May.”

At another point during the interview, Ackman said, “But I think our most significant next investment will be the announcement of our SPAC.”

Reddit poster LloydvChristmas on Monday posted a spliced video of the two responses, suggesting that the SPAC deal announcement would therefore come “between tomorrow and middle of May.”

But as some Tontards, as the Reddit posters like to call themselves, pointed out, the two comments weren’t necessarily related. A Pershing Square spokesman confirmed to Institutional Investor on Monday that Ackman was, indeed, talking about two different investments.

His mid-May reference appears to refer to the quarterly disclosures hedge funds file with the Securities and Exchange Commission. In these 13F filings, the funds list their publicly traded stocks held some 45 days earlier — in this case, at the end of March.

Regardless of the timing of its merger deal, Pershing Square Tontine, or PSTH, is the best-performing SPAC of those that have not yet announced a deal, having gained 27 percent since inception last July.

This year, however, PSTH has been victim to the selloff in SPACs: It hit its peak on Feb. 16, when it went as high as $34.10. It is now down 11.36 percent in 2021, though it rose 2.33 percent in April and closed near $25 on Monday.

The April rebound helped push Ackman’s Pershing Square Holdings up 4.2 percent in April, leaving the hedge fund with a 11.8 percent gain for the year through the first four months.

“We are all in a PSTH support group”

The Reddit cultists have continued to stalk Ackman’s every move and parse every word — but their speculation has been costly in the past.

Many of them lost money betting an announcement would come by the end of the first quarter, given a comment by Ackman last November that he hoped to get a deal done in that time frame.

Near the end of March, however, in a letter that was part of the 2020 annual report for Pershing Square Holdings, Ackman said that he wouldn’t be able to make an announcement by the quarter’s end.

After that disappointment, Reddit investors had hoped Ackman would make a deal announcement at a speech he was giving for Harvard students on April 22. Why? Ackman had originally scheduled the talk a week earlier and had to reschedule.

But, according to a Reddit poster who apparently was at the event, Ackman merely told the Harvard group that “the proof is in the pudding,” unleashing more than a dozen memes among the Reddit users. In last week’s interview, Ackman confirmed the statement. “As I’ve said, the proof is in the pudding, meaning we have to deliver on what we said we were going to do, and I’m confident we’re going to do that.”

Forum members — many of whom say they bought calls that expired worthless and added to their stock positions when the SPAC was trading higher — say they are trying to hang on.

“We are all in a PSTH support group,” one Tontine investor wrote II in a direct message on Twitter, saying the group is “where we share new information and ‘positive vibes’ amongst ourselves.”

Many of these investors have moaned on Reddit about their losses — and some have gone directly to Pershing Square. In an email that II was blind-copied on, a purported 33-year-old retail investor calling himself Sam Lopin said he had become so convinced that the Pershing Square SPAC “was the best opportunity in the market, hands down, that I invested 100 percent of my assets and my joint investment account with my wife into shares.”

While Lopin said he had lost a “substantial portion” of his investment, and was embarrassed to tell his family about the losses, he didn’t seem to have despaired that he would one day profit. He closed the letter saying, “I truly hope a deal is right around the corner as you have hinted at before.”