ADP shares spike on report that hedge fund manager Bill Ackman is building a stake

Billionaire investor Bill Ackman's Pershing Square Capital Management is said to be building a stake in Automatic Data Processing, Bloomberg reported, citing sources. Shares of ADP spiked on the news.

Pershing has already acquired shares in the business outsourcing company and could acquire more in new funds it filed documents for last week, Bloomberg reported. The size of the stake is unknown. The fund firm previously owned ADP from 2009 to 2011.

ADP shares were up 11 percent after the report came out, but they were already climbing during morning trading after earnings were announced. They are up more than 12 percent this year.

A spokesman for Pershing had no comment. A spokesman for ADP wasn't immediately available.

Pershing is known to take big bets on a limited number of companies, pushing some of them to make changes to their boards or operations. It scored big with General Growth Properties and Wendy's but recently stumbled on Valeant Pharamceuticals, finally exiting the position earlier this year.

Ackman is also famous for shorting shares of companies and waging public wars against them, notably his five year campaign with Herbalife.