We are an alternative asset management company that manages pools of permanent capital invested in long-term, high-return investment strategies. Our growth is principally driven by the long-term compounding of our assets under management and the opportunistic launch of new permanent capital vehicles that enable us to pursue new investment verticals or to pursue our core investment strategies in new jurisdictions. Durable Permanent Capital Base. Nearly all of our assets under management consist of permanent capital—assets that are not subject to withdrawal or redemption at the option of the fund investor or shareholder. The permanency of our capital is due to durable contractual arrangements. Our growth is largely organic, driven by the long-term compound annual returns of our permanent capital vehicles and the retention and reinvestment of our assets, rather than by continual fundraising and the launch of an ever-increasing number of new products and strategies. In contrast to other private equity alternative asset managers who must raise increasingly larger funds in order to replace liquidated funds and to grow their fee-paying assets, our Fee-Paying AUM growth is largely driven by our long-term investment returns. Even if one were to ignore the potential additions to our growth from the future launch of new investment vehicles, we believe that our existing permanent capital funds and vehicles, which will include PSUS following the combined offering, will enable us to achieve high, long-term, compound rates of growth in Fee-Paying AUM, revenues, and profits driven by our long-term investment returns and asset retention. Our strategy of organic growth via the compounding and retention of our assets is less sensitive to the market for raising capital and does not require the organizational complexity and expense of a large fundraising operation. While new fund launches can lead to step-change ‘overnight’ increases in our Fee-Paying AUM, we believe that they are not required for us to generate highly attractive long-term returns for shareholders. Simple, Lean, High-Margin Business Model. We pursue a unified investment strategy across our investment vehicles that leverages the core competencies of a limited number of investment professionals, resulting in a highly scalable and profitable operating model. We believe our systems, investment team, and other organizational resources are capable of managing an asset base many times larger than our current AUM. Predictable and Recurring Fee-Related Earnings. We benefit from predictable and recurring revenues primarily consisting of management fees, which, in the case of our core funds, are typically equal to 1.5% of net asset value per annum paid quarterly, and a senior claim on performance fees, which are paid annually as long as our funds have generated a positive return above a previous year’s high-water mark. Unlike private equity fund managers whose incentive fees are earned only when the manager generates realized gains in excess of an annual preferred return (typically 8%), our performance fees are paid annually as long as the mark-to-market net asset value of a fund at year-end increases above its high-water mark, whether these gains are realized or unrealized, and without the requirement for a fund to achieve a preferred return. Unlike other publicly traded alternative asset managers that receive a pro rata share of the performance fees paid by their funds with the balance paid to compensate employees, Pershing Square Inc. retains a preferred interest in performance fees—generally, the annual performance fees from each fund earned on the first five percentage points of return net of the management fee, which we refer to as “Preferred Performance Fees”—and pays the balance of performance fees, which we refer to as the “Subordinated Performance Fees,” to CompCo (as defined below), an entity that compensates its members (including our investment professionals and certain other employees). Pershing Square Inc. retains a senior claim on the Preferred Performance Fees, a claim which accrues to a subsequent year or years in the event it is not fully paid in any one year. This arrangement increases the certainty and predictability to us of performance-related revenue because as long as our funds can achieve a 5% annual compound return net of their management fees over the long-term, the Preferred Performance Fees will be fully paid. Long-Tenured and Highly Aligned Investment Team. We believe we have been able to attract and retain some of the best industry talent in the investment management business. We believe that the highly attractive economics of our business—with one of the largest amounts of invested capital per employee in the industry—along with our unique permanent capital base and family-oriented collaborative culture make us a highly desirable place to work. We believe that our approach to employee compensation, together with the significant levels of employee investment in our funds, creates a high degree of alignment between our team and our investors. Governance and C-Corporation Structure. We have designed the governance arrangements of Pershing Square Inc. to foster alignment between our management and our public investors. Despite the fact that the substantial majority of our stock is held by our management, our board is comprised of a majority of independent directors, our board committees are comprised of independent directors, and we have committed to operate with best-in-class governance principles that are not required for controlled companies. Furthermore, both our management and public shareholders will own common stock of our publicly traded corporation in contrast to the two-tiered, “UP-C” ownership structures frequently employed by other publicly traded alternative investment managers, in which differences in the ownership interests held by management and public investors and complicated tax receivable agreements can create misaligned incentives. Brand and Reputation. Since our founding more than 22 years ago, we have established a strong track record of outperforming the market and have built substantial reputational equity due to our history of constructive engagements with portfolio company leadership teams, board of directors, and retail and institutional shareholders. We believe we have also earned a reputation for being a good partner to our fund investors even if such actions come at a cost to us and are not contractually required. We believe our brand and reputation have enabled us to launch new funds and investment vehicles and raise capital to pursue new opportunities. We believe this combined offering, which coincides with two milestone transactions that we believe are transformational for our business, represents an attractive entry point for new owners of Pershing Square. Upon completion of the combined offering, PSUS will be our first permanent capital vehicle marketed to U.S. investors and represents a material expansion of our permanent capital AUM. On May 5, 2025, we completed the Howard Hughes Transaction in which we acquired 15% of the shares outstanding of Howard Hughes Holdings Inc. (“HHH”) (for a total interest in HHH of 47% including shares held by our core funds), which we expect will further drive our long-term growth. We intend to transform HHH, a long-term holding of our core funds, into a diversified holding company. On December 17, 2025, HHH entered into an agreement to acquire Vantage Group Holdings, Ltd. (“Vantage” and such acquisition, the “Vantage Acquisition”), a privately held specialty insurance and reinsurance holding company, for approximately $2.1 billion in cash. In connection with the Vantage Acquisition, it is expected that PSCM will be engaged as investment manager for Vantage and its insurance company subsidiaries. The Vantage Acquisition is expected to close in the second quarter of 2026, subject to customary regulatory approvals and closing conditions. We believe that the Vantage Acquisition will anchor HHH’s transformation into a diversified holding company by combining our investment capabilities with Vantage management’s insurance expertise and operations, enabling HHH to build and grow a profitable insurance company, which has the potential to serve as an important source of long-term value creation for HHH and our shareholders. HHH has also announced that, over time, it intends to acquire controlling ownership of high-quality, durable growth public and private operating companies, while continuing to invest in and grow its master planned communities (“MPC”) real estate business. Our principal executive offices are located in New York, New York.
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