Howard Hughes Holdings Inc. (HHH) Pursues Diversification and Long-Term Growth

Howard Hughes Holdings Inc. (NYSE:HHH) is one of the best stocks to buy, according to billionaire Bill Ackman. In December, Reuters reported the company is poised to purchase specialty insurance firm Vantage Group Holdings.

The $2.1 billion acquisition is part of the real estate firm’s bid to diversify its footprint beyond property development. Additionally, the deal is expected to transform Howard Hughes Holdings into a diversified holding company akin to Berkshire Hathaway, as Vantage boasts a diversified portfolio of property and casualty products.

The company is to fund the acquisition with cash and up to a $1 billion loan from Bill Ackman’s hedge fund, Pershing Square. In return, it could buy back the stock from Pershing Square over seven years at a premium based on Vantage’s book value. The acquisition comes as the company increasingly buys controlling stakes in smaller businesses in other sectors as part of a diversification strategy.

“We’re following a playbook that worked for Berkshire Hathaway – starting with a core business and adding insurance to create a platform for long-term capital compounding,” said executive chair Ackman in a statement.

Howard Hughes Holdings Inc. (NYSE:HHH) develops, owns, and manages large-scale, mixed-use master-planned communities and commercial and residential real estate across the U.S. It focuses on creating vibrant places with a strong emphasis on design and long-term community growth, with significant developments in Las Vegas, Houston, and Honolulu, among others.

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Disclosure: None. This article is originally published at Insider Monkey.