(Chicago Tribune) – NEW YORK — There is little doubt that the increasingly opulent hedge fund community–if there is one–is proud of William Ackman’s charge on McDonald’s Corp.
That an aggressive hedge fund manager like Ackman, general partner of New York-based Pershing Square Capital Management LP, can force an American corporate icon like McDonald’s to even listen to a dramatic restructuring proposal is a provocative development.
“These are managers who are extremely smart and aggressive, and armed with lots of money,” said Christopher Geczy, associate finance professor at the University of Pennsylvania’s Wharton School. “Most of all, they need to extract excellent returns quickly.”
In this age of shareholder activism, Geczy adds, hedge fund managers aren’t shy about pressuring corporate executives.
Part of the reason is that the stock market, by and large, is trading sideways. So the more demanding–and wealthy–investor is turning to hedge funds that regularly make large bets on a few stocks.
