Tag Archive for Bill Ackman

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2 Year Anniversary Of $1 Billion Bet Against Herbalife: $97.4 Million Spent On Case

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It’s been two years since Bill Ackman launched the billion-dollar short bet heard ’round the world.
On Dec. 20, 2012, the founder of Pershing Square Capital Management LP announced his bet against the nutritional supplement company Herbalife Ltd. in a three-hour-plus PowerPoint presentation that spanned 334 slides. He called the company a “pyramid scheme” and said it has caused “enormous harm” to “vulnerable communities around the world.”

As of Thursday’s close, Herbalife’s stock was down about 11% from where it closed on Dec. 18, 2012 (word that Mr. Ackman was betting against Herbalife leaked the day before the presentation, causing the stock to drop). That change masks two years of massive volatility in the stock, millions spent by Mr. Ackman spelling out his case and millions spent by Herbalife defending its business model.
In the meantime, some of the world’s best-known money managers have piled into the stock, taking the other side of Mr. Ackman’s bet. Feuds between Mr. Ackman and some of his nemeses have been thrown into the public spotlight and at least one feud has morphed into perhaps a friendship.
Here’s a look back at Mr. Ackman’s Herbalife bet by the numbers:
Mr. Ackman’s short position in Herbalife: $1 billion
What Mr. Ackman has spent making his case that the

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Ackman Sends Warning To Herbalife’s New Compliance Chief

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The NY Post reported earlier today:
Bill Ackman wants to give Herbalife’s new head of compliance, Pamela Jones Harbour, a few pointers.
The billionaire activist and Herbalife’s biggest critic on Thursday fired off a 19-page letter to Harbour — who has been on the job just a month — telling her that she has her work cut out for her.

“Based on our extensive investigation over the past three years, we believe Herbalife operates the largest and best-managed pyramid scheme in the world,” David Klafter, a lawyer for Ackman’s Pershing Square hedge fund, wrote in the letter first reported by Reuters.

Harbour is facing an “immense” challenge as the company’s business will likely collapse if she does her job and acts in the best interests of consumers, the letter warns.
“You may find yourself at the fulcrum of choosing between protecting consumers or protecting the company. Based on our research, we do not believe you can do both,” Klafter said.
Herbalife’s declining sales in the US over the past two quarters indicate that is already happening, Klafter suggested.
Since Herbalife stunned Wall Street on Monday with lower-than-expected earnings and dismal projections, the stock has fallen about 30 percent, closing at $39.99 on Thursday.
While Herbalife has suggested

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Ackman Says “My Bad” On Herbalife Presentation

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Hedge fund manager Bill Ackman has two words to sum up his Herbalife Ltd. (HLF) presentation last week: “My bad.”
Investors may have missed the point because the event was long and overhyped, Ackman said in an interview. Even the private researcher who helped convince Ackman the company is an illegal pyramid scheme now says the details of a two-year investigation into Herbalife’s nutrition clubs were largely ignored.
Ackman had promised to show an Enron-style fraud during the event. Instead of dumping the stock, investors sent the shares up 25 percent after the presentation, marking the biggest one-day gain in the history of the company. Ackman’s firm, Pershing Square Capital Management LP, bet $1 billion against the stock in 2012.
“It was a PR failure,” Ackman said. “I think we raised expectations. People were looking for the dead body and the smoking gun and instead what they got was a three-hour detailed regulatory presentation.”
The shares declined 6.1 percent to $52.40 at the close in New York.
Lost amid the earlier share gain was research that offers evidence of an elaborate and secretive illegal recruiting system, said Christine Richard, a former journalist who helped Ackman present material at the New York event.
William “Bill” Ackman, founder and chief executive officer of Pershing Square Capital

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Statement From Herbalife In Response To Bill Ackman’s Three-Hour Presentation On Nutrition Clubs

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Herbalife Ltd. (NYSE:HLF) today issued the following statement in response to Bill Ackman’s three-hour, presentation on the Company’s nutrition clubs:
Herbalife is a 34-year old nutrition company with 7,400 employees worldwide and millions of members. Today, Mr. Ackman highlighted many of the reasons we are proud of our company, our record and the value we bring to members, consumers and communities around the world. His presentation reaffirmed that:
Herbalife is first and foremost a company with great products that people want.
There are hundreds of thousands of members and millions more consumers who choose Herbalife for our products and community-based approach to health and wellness.
There is a comprehensive training system for members who aspire to open their own nutrition club so that they are fully informed of the time, commitment and skills required to do so.
Once again, Bill Ackman has over-promised and under-delivered on his $1 billion bet against our company. After spending $50 million, two years and tens of thousands of man-hours, Bill Ackman further demonstrated today that the facts are on our side.
We will continue to focus on our mission of bringing good nutrition and economic opportunities to communities across the globe. We recognize that he is running out of time to make good on his bad bet

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The Bill Ackman Contradiction

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Over the last year I’ve been reporting on the battle between hedge-fund manager Bill Ackman and Herbalife. Bill Ackman has made very little, if any, progress in his attack. Each time he comes at Herbalife with something that looks potentially disastrous, Herbalife returns with further proof that Bill Ackman is wrong. This has no longer become a matter of whether Herbalife is selling good products (the question has never come up once, strangely) or whether they have a good pay plan, or even what their training programs are like. 
The main issue, for Bill Ackman, has always been that Herbalife is a pyramid scheme, focusing on only recruiting individuals to make money. The hypocrisy seems to alude individuals paying attention to the ongoing and unforgiving battle. Bill Ackman’s only products offered by his own company is based on one sole result; money. His sole job is to take money and turn it into more money. He’s the CEO of Pershing Square Capital, a company that’s only product is money. Sure, he considers himself an ‘activist investor’ but that alone can seem like an oxymoron to many, especially those who could never afford the Harvard education he received and millions he himself invested to

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