Ackman and Target: Another Battle Brewing

True to his word, it appears Ackman is going for the long haul in Target (TGT). My guess is his TIP REIT idea is not dead and rather than have a large option position that management used against him in the proxy fight, he is going to own shares.

It is a good idea. Rather than allow them to say he simply wants a quick profit before his options expire and cares nothing about the long term health of the company, he in one fell swoop both takes that argument away from them and also bolsters his own "I own more shares than management and have more of a vested interest" argument. Looks like we have another battle brewing....


From the filing:

Item 1. Security and Issuer.
This Amendment No. 9 to Schedule 13D (this “Amendment No. 9”) amends and supplements the statement on Schedule 13D originally filed on July 16, 2007 (the “Original Schedule 13D”), as amended by Amendment No. 1 through Amendment No. 8 (the Original Schedule 13D as amended and supplemented by Amendment No. 1 through Amendment No. 8, the “Schedule 13D”), by (i) Pershing Square Capital Management, L.P., a Delaware limited partnership (“Pershing Square”), (ii) PS Management GP, LLC, a Delaware limited liability company, (iii) Pershing Square GP, LLC, a Delaware limited liability company, (iv) Pershing Square Holdings GP, LLC, a Delaware limited liability company, and (v) William A. Ackman, a citizen of the United States of America (collectively, the “Reporting Persons”), relating to the common stock, par value $0.0833 per share (the “Common Stock”), of Target Corporation, a Minnesota corporation (the “Issuer”, the “Company” or “Target”).
As of August 7, 2009, as reflected in this Amendment No. 9, the Reporting Persons are reporting beneficial ownership on an aggregate basis of 32,994,586 shares of Common Stock (approximately 4.4% of the outstanding shares of Common Stock), which include shares of Common Stock and shares subject to certain stock-settled American-style call options.

Item 4. Purpose of Transaction.

Item 4 of the Schedule 13D is hereby supplemented as follows:
As of May 26, 2009, the date of the last amendment to this Schedule 13D, the Reporting Persons beneficially owned approximately 7.8% of the then outstanding shares of Common Stock, consisting of 3.3% in shares of Common Stock and 4.5% in stock-settled call options. As a result of the transactions reported in this Amendment No. 9, the Reporting Persons sold options and engaged in net purchases of shares of Common Stock, resulting in a net increase of Common Stock ownership of 0.2% and a decrease of beneficial ownership to 4.4%, consisting of 3.5% in shares of Common Stock and 0.9% in stock-settled call options.

Item 5. Interests in Securities of the Issuer.
(a), (b) Based upon the Issuer’s quarterly report on Form 10-Q for the quarterly period ended May 2, 2009, there were 752,279,589 shares of Common Stock outstanding as of June 3, 2009. Based on the foregoing, 32,994,586 shares of Common Stock (which includes Common Stock and physically-settled listed and over-the-counter American-style call options), representing 4.4% of the shares of Common Stock issued and outstanding, are reported on this Amendment No. 9.
As of the date hereof, none of the Reporting Persons owns any shares of the Common Stock other than as reported herein.
Item 5(c) of the Schedule 13D is hereby amended and restated as follows:
(c) See the trading data for the last 60 days attached hereto as Exhibit 99.1. Exhibit 99.1 is incorporated by reference into this Item 5(c) as if set out herein in full.
Except as set forth in Exhibit 99.1 attached hereto, within the last 60 days, no other transaction in shares of the Common Stock or derivative securities were effected by any Reporting Person.

Link to trading data


Disclosure: No position

Comments

[HardwoodFlo...:]

This jerk again. What's he gonna do this time- call on the spirit of Ghandi? What a Class A A-hole.

Aug 11 01:38 PM

[HardwoodFlo...:]

I love the idea that Ackman is cirling back at the REIT concept. What bank is going to underwrite a "reach-around" (a.k.a sale lease back) right now? Ackman, have some grace and class. I guess since crying and acting like an absolute child at the shareholders meeting he figures- “well I already ruined my reputation and career so what the hell might as well keep poking Target.

Target needs to hire the best lawyer in the world and just keep kicking this ass all the way back to Cambridge. He's such a classic HBS wanker. What the hell do they teach people at HBS anyway- I mean don't they learn to cut bait, trim their losses and move on to the next deal. Ackman is such a jerk he turned dollars in to pennies on the Target deal. Lost billions. What a loser.

Aug 11 01:45 PM

[Paulbaby:]

AMEN!!!!


On Aug 11 01:45 PM HardwoodFlooring wrote:

> I love the idea that Ackman is cirling back at the REIT concept.
> What bank is going to underwrite a "reach-around" (a.k.a sale lease
> back) right now? Ackman, have some grace and class. I guess since
> crying and acting like an absolute child at the shareholders meeting
> he figures- “well I already ruined my reputation and career so what
> the hell might as well keep poking Target.
>
> Target needs to hire the best lawyer in the world and just keep kicking
> this ass all the way back to Cambridge. He's such a classic HBS wanker.
> What the hell do they teach people at HBS anyway- I mean don't they
> learn to cut bait, trim their losses and move on to the next deal.
> Ackman is such a jerk he turned dollars in to pennies on the Target
> deal. Lost billions. What a loser.

Aug 12 09:55 AM

[Glenn Alperin:]

HardwoodFlooring, given the market downfall recently, can you blame Ackman? He's just trying to cash in while the share price is relatively low, like any stock trader, so he can sell when the share price goes high again.

I supported his proxy fight battle. (See my previous article about Target on SeekingAlpha here: seekingalpha.com/artic... ) Granted, it would have failed miserably in light of the recent economic mess we are in now, but all the more reason he should go with the REIT idea now. (No pun intended.) Real estate has practically bottomed out. Recent economic trends I have read suggest that a recovery will be slow, but it will occur, at least on a commercial level. Consumers can forget about any recovery until there is sufficient economic incentive for them to go out and buy (I believe the words for that is "economically sustainable jobs", which is an interesting dialectic given Wall Street's pension for clapping every time people are laid off of work, and rewarding companies only for bottom line profits at the expense of future economic gains from a sustainable consumer base), but commercial real estate is likely to come back a little sooner.

So a REIT would have been a bad idea at its inception, but we only know that given recent economic trends. I still think it would be a good idea NOW, where the commercial real estate market is likely to be headed on the upswing sooner than the consumer real estate market will.

Aug 12 10:38 PM