Fannie Freddie Reform Moves Forward with Ackman Plan

Ackman’s Alternative: A Slower Path Forward

Bill Ackman, CEO of Pershing Square and the largest common shareholder in Fannie Mae and Freddie Mac, believes now isn’t the right time to take the mortgage giants public. Instead, he recommends a smaller step: move the companies’ existing stock from over-the-counter markets to a major exchange like the NYSE.

Bisnow reports that Ackman shared the idea Tuesday, saying this path would increase transparency and investor confidence — without triggering the risks of an IPO.

Why Skip the IPO

According to Ackman, Fannie and Freddie still face governance and structural issues. An IPO, he says, would expose the firms to market pressures they aren’t ready for and potentially dilute shareholder value.

He points out that the federal government’s 2008 bailout — which included $100B in senior preferred shares — has already returned $301B in dividends. That exceeds the original support, which Ackman calls a full repayment. He wants the Treasury to acknowledge this and stop treating the senior notes as outstanding obligations.

Instead of converting those notes to common stock, which would hurt existing shareholders, Ackman suggests keeping the government’s 79.9% equity stake in place.

“A 79.9% stake in these entities is an excellent asset for a sovereign wealth fund,” he said.

Political and Market Impact

Ackman says relisting the shares offers President Trump a low-risk win, aligning with his earlier comments about plans to end GSE conservatorship during Trump’s second term — a position he’s publicly shared before. The move would expand access to new investors, calm fears among preferred shareholders, and increase market visibility — all while keeping conservatorship intact.

He claims the change could push share prices from under $10 today to as high as $40. The NYSE has already shown interest in fast-tracking the process, which could take just a few weeks if greenlit by the administration.

Ackman has already pitched the plan to top officials, including Treasury Secretary Scott Bessent and FHFA Director Bill Pulte.

Expert Reactions and Risks

Kristin Gannon of Eastdil Secured supports Ackman’s call for better governance but warns of potential confusion. She says listing the stock without ending conservatorship could create conflicts between public shareholders and the government’s oversight role.

“You need the right team, structure, and governance before you bring in public shareholders,” she said.

Ackman agrees governance needs work but believes his plan creates space to solve those problems while building momentum.

What’s Next

Ackman made his pitch public to start a debate. He welcomed input from critics like Sen. Elizabeth Warren and dismissed calls to merge the two GSEs — a proposal gaining some traction among Trump allies.

“The president’s meme talks about the Great American Mortgage Corp. He just left off an S,” Ackman joked. “They should remain independent.”

Ackman’s approach keeps government backing in place and avoids sudden market shocks. It also aligns with Trump’s campaign goals by showing progress on reform without introducing new financial risk.

“Now isn’t the time to sell,” Ackman said. “These companies are growing in value. There’s room for better management and more clarity.”

For now, Fannie and Freddie stay under conservatorship. But if Ackman gets his way, they may soon return to center stage — one baby step at a time.