The Perils of Pershing

WSJ is pulling no punches with this lede:

Hedge-fund manager Bill Ackman moved to dump his entire stake in J.C. Penney Co., JCP -1.12% ending a failed bet on the retailer that cost his fund more than $600 million, resulted in the loss of thousands of jobs and left the 1,100-store chain still struggling to right itself.

It’s not every day you lose more than half a billion dollars. At least, one would hope not.


Mr. Ackman’s Pershing Square Capital Management LP is unloading its 39 million shares—nearly 18% of Penney’s stock—with help from Citigroup Inc., C -0.46% which underwrote the sale.

Citigroup reached agreements to sell the shares to new buyers at $12.90 each, a person familiar with the matter said. That was well below their closing price Monday of $13.35 and close to half the roughly $25 apiece that Pershing Square paid for the shares, mostly in 2010 and 2011.

Ackman and his investors took a huge hit on a bad bet on an outmoded retailer which hired the wrong CEO.