Pershing Cooks Up New Plan

The hedge fund is set to present a revised proposal in its quest to transform McDonald's.
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Updated from 2:34 p.m. EST

Next week, activist hedge fund manager Bill Ackman will take center stage to tell the world, once again, his opinion on how

McDonald's

(MCD) - Get Report

can transform itself and unlock shareholder value.

The pesky head of Pershing Square Capital saw his original restructuring plan

swiftly rejected by the fast-food chain in November. Ackman will present his revised plan to shareholders, analysts and the media on Jan. 18 at 11 a.m. at the Millennium Broadway Hotel in New York.

Pershing Square, which owns 4.9% of McDonald's, mostly through deep in-the-money options, had urged the fast-food chain to spin off its company-operated restaurants into a separate public company to unlock its real estate value.

Ackman felt this move would transform McDonald's into a more real-estate focused company that simply collects rental and franchise fees from its franchisees. The company-operated restaurants have been criticized as being highly cost-intensive and less profitable.

Under his old plan, Ackman projected McDonald's stock would be rewarded with a higher valuation, and shares would trade $10 to $15 higher. McDonald's, for its part, has said the proposal would pose strategic and financial risks and wouldn't create value for shareholders.

"Following extensive conversations with numerous franchisees and shareholders over the past two months, Pershing Square has revised its proposal to address management's concerns and those of other stakeholders and to demonstrate how McDonald's can re-align its operations to drive business improvements, strengthen the McDonald's franchise system, and create significant shareholder value," the fund said in a statement Thursday.

Ackman could not be reached for additional details.

Anna Rozenich, a spokeswoman for McDonald's, said the company has heard from Ackman and will await his presentation before commenting further.

"We are committed to our 'Plan to Win,' which we believe is creating value for shareholders," she said. "It remains to be seen whether Mr. Ackman has come up with anything new."