Pershing Square Tontine Holdings (NYSE:PSTH) announced this afternoon that it will be liquidating its trust and redeeming all outstanding shares of common stock effective as of July 26, 2022.

The SPAC was unable to complete a business combination within its timeline of 24 months from the closing of its record $4 billion IPO on July 24, 2020. And as a result, Pershing Square will now cease all operations except for the purposes of winding up, and will redeem all public shares. Following the redemption, the SPAC will then dissolve and liquidate.

Pershing Square Tontine Holdings currently expects the per-share redemption price for the public shares to be approximately $20.05. The public shares are expected to stop trading as of the close of business on July 25, 2022, and as of July 26, 2022 the public shares will be deemed cancelled and will represent only the right to receive the redemption amount.

Additionally, Pershing Square Tontine Holdings has decided not to withhold any amounts to pay dissolution expenses, which were permitted to be withheld in an amount up to $100,000.

Furthermore, in a letter also released today from Bill Ackman, CEO and Founder of Pershing Square Tontine Holdings, it was announced that he would continue to seek approval of the SPARC structure. The SPARC structure was originally debuted last summer when he announced PSTH’s initial transaction with Universal Music Group (“UMG”).

At that time, Ackman’s intention was for PSTH to acquire a 10% stake in UMG for an approximate enterprise value of $42.4 billion. But, the deal was later terminated and Ackman faced a lawsuit brought by a former SEC commissioner and a law school professor that alleged that the SPAC acted as an investment company, violating Investment Company Act rules.

Technically, Ackman could have extended PSTH’s deadline a further six months to January 24, 2023 since the SPAC had previously executed a definitive agreement with UMG. Even though that transaction is no longer active, the wording in the IPO prospectus is such that the SPAC merely had to have previously signed an LOI or definitive agreement within 24 months to qualify.

Nonetheless, Ackman found a liquidation to be more palatable than soldiering on.

As for Pershing Square SPARC Holdings, the most recent amendment to the initial S-1 was filed on June 16th. Once the registration statement is approved, Ackman intends to distribute SPARs to PSTH shareholders as of July 25th. However, there’s no guarantee that the SPARC structure will be approved by the SEC and Ackman goes on to note that they don’t expect the registration statement to be approved until later this Fall.

We’ll have to check if there are any additional changes to the SPARC structure in any subsequent filings, but this is still an unproven deal type. Will any of the “big game” companies Ackman is hunting want to go down the SPARC path without knowing how much money can be raised by SPAR holders until they exercise? Why not just go down a proven traditional IPO path instead?

We’ll have to wait and see.