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Bill Ackman sells $1 billion stake in Berkshire Hathaway, says his firm can be more 'nimble'

The holding accounted for nearly 10 percent of Pershing's entire asset under management at the end of March.

May 28, 2020 / 09:10 AM IST

Pershing Square Capital founder Bill Ackman on May 28 said his firm has dumped its $1 billion worth of stake in Warren Buffett's Berkshire Hathaway.

Ackman said his hedge fund can seize opportunities in the market faster than the conglomerate.

"The one advantage we have versus Berkshire is relative scale. We can be much more nimble." Ackman said on a quarterly call with investors.

The holding accounted for nearly 10 percent of Pershing's entire asset under management at the end of March.

As per media reports, the stake sale comes less than a year after the firm first invested in Berkshire. Pershing had recently increased the stake in the Warren Buffett-led company saying that the company was "built by Warren Buffett to withstand a global economic shock like this one".

Ackman, who has been a staunch follower of Buffett's investing acumen, may have parted ways with the Omaha firm after it failed to make the "elephant-sized" acquisition in the wake of coronavirus after complaining of high valuations in the years prior to the pandemic.

Berkshire's cash pile swelled to a record $137 billion at the end of March and the firm reported a $49.7 billion loss in the first three months of the year.

On the other hand, Ackman was able to surf through the pandemic as he hedged his positions much earlier in the year citing that the creditworthiness of companies would be severely hit by the pandemic. The stout decision landed Pershing a whopping a $2.6 billion windfall early on.

In mid-March, the billionaire investor went on a buying spree proclaiming that Pershing had taken off all the hedges placed to offset the effects of the coronavirus.

"That’s about the most bullish thing we’ve done," he told Bloomberg. "We are all long. No shorts, you know, betting on the country."

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