Berggruen hopes cash shell will raise £700m

Nicolas Berggruen, the Paris-born billionaire investor, is seeking to raise £700m ($1,126m) in a flotation of a cash shell on the London Stock Exchange in the coming weeks.

The vehicle, called Justice, is looking for an acquisition worth between £1bn and £5bn, including debt. It has the backing of Mr Berggruen’s long-term business partner, Martin Franklin. Bill Ackman, the activist investor who heads Pershing Square Capital Management, is also believed to be on board.

Mr Berggruen has used cash shells in the past but this will be his first to list in London. Worth an estimated £1.4bn, the German-US national built his fortune by buying stakes in companies such as Karstadt, the German retailing group, and Prisa, the Spanish media conglomerate that publishes the newspaper El País.

Justice will be Mr Berggruen’s third cash shell. His first vehicle, Freedom Acquisitions, invested $1bn in GLG Partners, the hedge fund, in a deal worth $3.4bn in 2007. His second, Liberty Acquisitions, invested £520m in Pearl Insurance in 2009 and €900m in Prisa last year.

Lord Myners, the former fund manager who was City minister under the previous Labour government, has been approached to chair Justice.

He declined to comment on Sunday night but people close to him said the role fitted with his desire to build a portfolio of entrepreneurial roles. The potential move comes as Lord Myners is poised to become chairman at Autonomous, the independent research house.

Nouriel Roubini, the economist nicknamed Dr Doom after he predicted the global credit crunch, has also been approached to join the board. Citigroup and Barclays Capital are acting as advisers.

Mr Berggruen hit the headlines in 2008 after giving his art to museums on long-term loans and selling his homes in New York and Florida, as well as most of his possessions. He now moves from hotel to hotel around the world. Alongside his financial interests, he has also set up a think-tank, the Nicolas Berggruen Institute, which aims to promote debate about political reform.

Recently, Mr Berggruen used $25m to launch a campaign to “save” California, promoting radical fiscal measures to tackle the state’s debt burden.