Pershing to Acquire More of McDonalds

Date: Tuesday, September 5, 2006
Author: HFN Daily Report

Fast food giant McDonald's Corp. announced Friday it has been notified by Pershing Square Capital the hedge fund plans to acquire in excess of $793.8 million of the company's stock.

According to a filing with the Securities and Exchange Commission, Pershing must allow for a waiting period to terminate before increasing its ownership to the level it specified. The fund plans to repurchase McDonald's stock with shares of the soon-to-be spun off Chipotle Mexican Grill restaurant chain, the filing said.

Pershing Square manager William Ackman caused a stir in January when he laid out a plan calling for McDonald's to partially spin off company-owned stores and invest more in emerging markets. He later threw himself behind management's own plan to open an additional 800 company-owned restaurants but consider selling up to 1,500 under-performing venues.

Last year, Pershing Square pressured fellow fast food company Wendy's to spin off its profitable Tim Horton's doughnut shop chain, which went public in March.