At Forbes Philanthropy Summit On Thursday afternoon, billionaire private equity investor Robert F. Smith outlined his plan to close the racial wealth gap in America. Among his compelling ideas was a recommendation for America’s biggest corporations and Wall Street firms to take deliberate action to support black-owned businesses and banks. Capitalizing on these companies, Smith noted, could create a multiplier effect for minority communities, deepening opportunity and narrowing an inexcusably wide wealth gap.

Today’s important national debate about the racial wealth gap is starting to generate action. In fact, one of Wall Street’s biggest and most anticipated deals of 2020 is set to set a new bar in the use of black-owned businesses, those run by other underrepresented minorities. and veterans.

Billionaire Bill Ackman of hedge fund Pershing Square Capital Management is in the process of listing a massive $4 billion pool of publicly traded capital to make his next major investment. To seal the deal, Ackman hired investment banks run and owned by black, female, and veteran founders.

His Pershing Square Tontine Holdings will be a special purpose acquisition company listed on the New York Stock Exchange that will sell what is expected to be $3 billion in investable stock. This funding, combined with a $1 billion commitment from Pershing Square, means the vehicle would need to have at least $4 billion in buying power to make a major minority investment in a business. Pershing Square’s prospectus signals that it can target a “mature unicorn,” a later-stage venture-backed company, or a private equity firm seeking new equity to deleverage.

Bookrunners for the deal are megabanks Citigroup, Jefferies and UBS. But the deal’s co-managers are CastleOak Securities, Loop Capital Markets, Ramirez & Co, Siebert Williams Shank, Academy Securities, CL King & Associates and Roberts and Ryan. All of these co-managers are either black-owned investment banks or banks run by women, Hispanics and veterans.

Forbes learned that the deal will also have some unique features. Of the $86 million in fees paid to underwriters shown in the registration statement, approximately 20%, or approximately $18 million, is expected to be paid to underrepresented minority and veteran-owned companies. This should be several multiples of the typical fee percentage paid to minority-owned companies participating in stock offerings. The offering of shares in the offering will likely also have high percentages distributed by minority-owned companies, not just bookrunners. If all of the over-allotments from Pershing Square and public investors are exercised, the vehicle could total nearly $6.5 billion in equity, by far the largest special purpose acquisition vehicle in history and likely the one of the most notable deals of 2020. (Through a spokesperson, Ackman declined to comment citing the quiet period of the offer).

Underwriters include New York-based CastleOak Securities, co-founded by CEO David R. Jones in 2006. CastleOak has become one of the largest black-owned investment banks on Wall Street with a major underwriting presence. fixed income securities. He has co-managed bond transactions involving Bank of America, Citigroup, AT&T and Royal Bank of Canada in excess of $1 billion. Since co-founding the company in 2006, Jones has helped oversee CastleOak’s participation in $2 trillion in public offerings. Prior to CastleOak, Jones, a graduate of Boston University and the University of Pennsylvania’s Wharton School of Business, was a top dealmaker at Blaylock & Co and, before that, Merrill Lynch. Wholly employee-owned, CastleOak now has approximately 50 employees and is gaining market share in the fixed income underwriting markets.

Chicago-based Loop Capital, another underwriter of Ackman’s deal, was co-founded by black businessman James Reynolds Jr. in 1997 and is one of the largest corporate-owned investment banks. minorities in America. Like CastleOak, Loop Capital is a full-service investment bank whose business spans equity underwriting, sales and trading, merger advisory, public finance and tax-exempt fixed income trading. . The firm’s strength is in municipal finance, where it is a lead underwriter having recently acted as bookrunner on an Ohio State bond issue. He was also co-manager of Southwest Airlines’ recent bond deal. With a team of over 175 professionals, Loop Capital is active in the Chicago community, managing the City of Chicago’s PACE program and JLC Infrastructure, an investment and asset management firm founded in 2015 with Magic Johnson Enterprises.

Ramirez & Co, founded by Samuel A. Ramirez in 1971, is one of the largest and oldest Hispanic investment banks on Wall Street. Ramirez launched his career at Kidder Peabody in 1963, before leaving to start his own company, which became a leader in municipal finance and fixed income securities. With a staff of 140 professions, he most recently served as a senior executive on bond transactions for the cities of Houston and New York and the Metropolitan Washington Airport Authority. In the community, his notable efforts include working with the Municipal Forum’s “Futures and Options” program, which gives minority New York high school students the opportunity to work as interns at financial firms, rating agencies, insurers bondholders and law firms.

Siebert Williams Shank & Co., another of the deal’s underwriters, is one of the nation’s largest black and women-owned investment banks. It was created last year by the merger of Siebert Cisneros Shank, founded in 1996, and The Williams Capital Group, founded in 1994. The merger brought together two of the best underwriters in municipal debt and corporate underwriting. As a stand-alone firm, Williams Capital consistently ranked among the top corporate underwriters, and Siebert Cisneros Shank was the largest female and minority-owned municipal finance company by deal volume for nearly two decades. The company was co-founded by CEO Suzanne Shank and Muriel Siebert, the first woman to hold a seat on the New York Stock Exchange.

Veteran-owned investment banks on the deal include Academy Securities, founded by Chance Mims in 2009. Mims, a naval officer aboard USS Sentry MCM-3 and guided-missile destroyer USS John Paul Jones DDG-53 enforcing UN sanctions against Iraq and took part in initial strikes in Afghanistan during Operation Enduring Freedom. He is a graduate of the US Naval Academy and Indiana University Kelley School of Business. Prior to founding Academy Securities, Mims worked at a real estate brokerage firm and was an executive at Home Depot. Academy Securities was the first investment bank owned by veterans and disabled veterans established after the wars in Iraq and Afghanistan and specializes in equity capital markets, municipal finance and fixed income securities. Currently, 44% of Academy Securities’ staff are military veterans and 63% of the company’s stock is held by veterans.

CL King & Associates, founded by Candace King Weir in 1972, has long been one of the largest and most influential women-owned firms on Wall Street. King, a highly successful fund manager for high net worth clients, has built a large presence in equity underwriting and asset management. The company’s Paradigm Capital Management is a big investor and King is chief investment officer.

Roberts & Ryan, the latest co-manager of the deal, is run by former infantry and marine rifleman James Niemie. The company is one of Wall Street’s largest disabled veteran-owned brokers, founded by a Purple Heart recipient in 1987. In 2017, majority ownership and control of Roberts & Ryan was taken by a group of veterans military and experienced Wall Street. professionals, many of whom have disabled service status.

Even without its various underwriters, Ackman’s Pershing Square Tontine Holdings was going to be one of the big deals to watch in 2020. Its size of $4 billion to $6.5 billion means that any number of companies could be the vehicle’s target, and at a time when a plethora of private equity and venture capital investors would like to tap into the public capital markets. Ackman is also one of Wall Street’s most prominent investors, up about 30% in 2020 even as the S&P 500 is down. Last year, his Pershing Square gained 58% and was among the best performing hedge funds in the world.

With its size, the minority-owned investment bank’s tenure, and Ackman’s apparent intent to award outsized allowance and fees to those underwriters, the deal could become a watershed. Nearly $20 million in fees could help investment banks increase their staff, and inventory in what is likely to be a high-demand transaction could create new relationships for participating firms.

For more on Forbes’ coverage of Wall Street’s efforts for economic equality:

75 Black-Owned Businesses to Support

The Bezos of Black Wall Street

$9 billion bond titan talks racial inequality

Robert Smith’s 2% solution to inequality