Ackman 'Einhorns' Herbalife

Dec 20 2012 | 9:46am ET

The markets have been anxiously awaiting David Einhorn's take on Herbalife for months. The nutrition and weight-control company's shares even soared 17% in May when the Greenlight Capital founder failed to mention it at the Ira Sohn Investment Research Conference.

The markets may have been looking to the wrong man: Yesterday, Pershing Square Capital Management's William Ackman "Einhorned" Herbalife.

The activist hedge fund manager called Herbalife a "pyramid scheme" and said that he has been shorting the stock for seven or eight months, CNBC reports. He's expected to go into greater detail in his own speech at today's Sohn Conference.

But even without those details, Herbalife's shares hit the skids, falling more 12% yesterday and tripping a single-stock circuit-breaker along the way.

Herbalife isn’t taking the criticism lying down, accusing Ackman of attempting to "illegally manipulate the market."

"The allegation that Herbalife is a pyramid scheme is bogus," CEO Michael Johnson said. "Make no mistake: Today's announcement isn't about Herbalife's business model. It's about Bill Ackman's business model."

Johnson further urged the Securities and Exchange Commission to investigate Ackman's statements.


In Depth

Will Liquid Alts’ Performance Sustain Future Asset Flows?

Aug 25 2014 | 10:34am ET

Liquid alternative investment funds saw the highest percentage of capital inflows...

Lifestyle

Och Funds Women In Finance Initiative At U-M

Aug 28 2014 | 3:01pm ET

Och-Ziff Capital founder Daniel Och and his wife have made a "generous donation"...

Guest Contributor

Looking Ahead: What’s In Store For Managed Futures?

Aug 22 2014 | 12:52pm ET

The last five years were phenomenal for investors in equity indices. Will the next...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

The time was right

Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.