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Has Bill Ackman Forgotten About J.C. Penney, Procter & Gamble?

The sometimes-activist investor took a 1% stake in Dow industrials giant Procter & Gamble and called for the ouster of chief executive Bob McDonald during the summer.

While the activist effort has yet to cause a shakeup in the C-suite, Ackman's investment has been the catalyst for a 10%-plus rise in the company's stock as it breaches 52-week highs near $70. Instead of supporting management change, P&G committed to restructuring plans that cut $10 billion in costs by 2016 and 4,100 layoffs by June 2013.

J.C. Penney, Pershing Square's largest investment, has not fared as well, off over 30% year-to-date as the retailer and its new chief executive Ron Johnson struggle to implement new pricing strategies.

Ackman addressed J.C. Penney and P&G only when asked about the investments during a Q&A session after his presentation.

Ackman's real estate sector M&A drama has been brewing since General Growth's 2009 bankruptcy and its 2010 re-emergence. General Growth shares are far below the $28 share price that Ackman calculated some time ago might be reached in a merger. On Monday, Ackman instead quoted sell side research, saying Citigroup analysts argue Simon could pay as much as $24 per share for General Growth, whose shares closed at $19.41 on Monday.

As Ackman pushes the deal, he also says he is willing to sell his stake to Brookfield at over $19 if Simon is blocked from an acquisition by management.

According to the August letter, Ackman structured a takeover of General Growth with David Simon of Simon Property in 2011, worth nearly $20 billion. In the deal, General Growth shareholders would receive 0.1765 of a share of Simon stock -- at the time trading at $115 and valuing the company at $21, a 65% premium. Were that exchange offer to remain in a Simon Property merger at present share prices, Ackman calculates that General Growth could be valued at roughly $26 billion.

In the recent letter , Pershing asked that General Growth hire financial advisers to cement a previously discussed merger with Simon Property, as Brookfield tries to take control of the company through ordinary stock purchases and warrant contracts.

The drama marks what could be a turning point in General Growth's emergence from bankruptcy and an impressive 50%-plus stock surge in the past year on optimism about a widespread real estate recovery. Pershing and Brookfield were instrumental in pulling General Growth out of bankruptcy -- recapitalizing the company by raising $2.6 billion from the Fairholme Funds and $500 million from private equity giant Blackstone Group (BX).

Some of Ackman's previous Value Investing Conference focus stocks have fared well: he unveiled the calculations behind his proposed breakup of Fortune Brands Home Security (FBHS) last year, and it has been a top performer in the past 12 months, gaining over 100%.

In June, Ackman was one of the cornerstone investors in the initial public offering of Burger King Holdings (BKC), after Pershing Square took a 10% stake in the fast food chain by way of a special purpose vehicle, Justice Holdings, which he spoke about at last year's Value Investing Congress. Since its IPO, Burger King's stock is up roughly 50% to over $23, as of Monday's close.

-- Written by Antoine Gara in New York
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