Activist hedge fund boosts McDonald's stock holdings

Nation's Restaurant News,  Feb 26, 2007  

Tags: hedge fund, McDonald's Corp., stock

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New York -- Pershing Square Capital Management LP, the activist hedge fund founded by William Ackman, disclosed Feb. 14 that it had increased its equity in McDonald's Corp. to a 1.5-percent stake, leading to speculation that the fund is gearing up to pressure McDonald's to sell underperforming restaurants to franchisees or to do a leveraged recapitalization to boost its stock value.

In a regulatory filing that outlined end-of-year holdings, Pershing said it owns about 18.5 million McDonald's common shares, worth about $830 million, making it the ninth-largest shareholder. Previously, the fund held about 300,000 shares.

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