Sun, Feb 7, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Third Point takes 8.2% stake in Herbalife despite Ackman attack

Thursday, January 10, 2013

Bailey McCann, Opalesque New York: Daniel Loeb's Third Point, an activist hedge fund with approximately $10bn under management has taken an 8.2% stake in Herbalife, a supplement company that Bill Ackman has called a pyramid scheme. In a letter to investors reprinted on the New York Times Dealbook blog, Loeb explains the trade stating that he does not believe that Herbalife is a pyramid scheme, calling Ackman's theory "preposterous."

Pershing Square Capital Management founder Bill Ackman made news when he called the company a pyramid scheme publicly and announced he was shorting the firm. Herbalife is primarily distributed through independent sellers which are incentivized to recruit other independent sellers into the company. Pyramid schemes typically rely on this type of peer-to-peer recruitment structure, but Loeb insists that Ackman's read is incorrect and his accusation that the Federal Trade Commission (FTC) missed this call when the company has been in business for decades is equally unlikely.

According to an account in Bloomberg Businessweek, other analysts seem to be siding with Loeb over Ackman. In the article, Tim Ramey, an analyst with D.A. Davidson & Co. said that he thought Ackman's 3-hour presentation on his short......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. How Einhorn survived a nightmare year[more]

    From Bloomberg.com: Even when a hedge fund has an awful year, which was the case for David Einhorn's Greenlight Capital, there are lessons to be learned. Many funds would have had a tough time surviving a year like Einhorn experienced in 2015, when all the stars seemed to align against him and Green

  2. Legal - Hedge fund founder wins early release in U.S. insider trading case, Gramercy seeking $1.3 billion from Peru over land-bond dispute[more]

    Hedge fund founder wins early release in U.S. insider trading case From Reuters/Streetinsider.com: Former hedge fund manager Doug Whitman on Tuesday won a reprieve from serving the remainder of his two-year sentence for insider trading after several judges expressed skepticism that his 2

  3. Investing - David Einhorn finds a winner in Michael Kors[more]

    From Thestreetinsider.com: Greenlight Capital hedge fund manger David Einhorn took his lumps in 2015. The fund lost over 20 percent on the year amid bets gone bad being long a plunging SunEdison and short a couple high-flying FANG stocks. However, today Einhorn is again showing his stock picking pro

  4. Investing - Avenue Capital's Marc Lasry: We like European bank loans, Comment: A bunch of hedge fund managers are chasing the 'dream of crushing a major structural problem'[more]

    Avenue Capital's Marc Lasry: We like European bank loans From CNBC.com: European banks are under immense pressure, but at least one prominent hedge fund has found what it thinks is a good opportunity in the wreckage. Marc Lasry, co-founder and chief executive of hedge fund Avenue Capital

  5. Computer-driven hedge funds make money during January’s selloff[more]

    Komfie Manalo, Opalesque Asia: Commodity trading advisers (CTAs) that use computer programs to guide how they trade, made millions of dollars during last month’s market selloff on the back of declining oil prices and global equities and big moves in currencies. Data provider