Ackman Sells $125 Million of ADP Stake After Share Price Run-Up

(Bloomberg) -- Bill Ackman took advantage of a share price increase to sell about $125 million worth of his holdings in Automatic Data Processing Inc., the payroll outsourcer that he targeted in an unsuccessful proxy fight last year.

Pershing Square Capital Management, the activist fund run by Ackman, sold 5 million shares and options in the company, or about 14 percent of its overall ADP holdings, according to a regulatory filing. The sale reduces the New York hedge fund’s stake in ADP to about 7.2 percent from 8.3 percent previously, the filing shows.

Ackman has said the average cost of his investment in Roseland, New Jersey-based ADP, which remains Pershing’s largest holding, was about $105 a share. The company’s shares closed Tuesday at $117.39 each, meaning the value of Pershing Square’s holdings in the company had increased by about $456 million.

Ackman disclosed his initial stake in ADP in August and launched a proxy fight for three seats on the board, including one for himself. The billionaire investor argued the company was underperforming and needed to improve its margins and its offerings to customers. Ultimately, shareholders rejected Pershing Square’s candidates in November.

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