Saturday, 29 November 2014
Last updated 22 hours ago
Aug 23 2013 | 5:59am ET
Pershing Square Capital Management’s William Ackman is willing to admit he’s made mistakes—but his $1 billion short against Herbalife isn’t one of them.
Ackman wrote to clients on Tuesday, following a tumultuous few weeks that saw his name in the headlines about both his investment in the nutritional supplements company and in retailer J.C. Penney Co. The latter, Ackman said, was among his “mistakes,” and has proven a “failure.”
Ackman resigned from Penney’s board last week amidst a dispute between himself and his fellow directors over his public call for the ousters of the company’s chairman and interim CEO. The hedge fund manager indicated he might seek to sell his nearly 18% stake in the company, which is nursing a 40% loss.
“Clearly, retail has not been our strong suit, and this is duly noted,” Ackman wrote.
There was no such admission on Herbalife, which Ackman has called a pyramid scheme. Shares of the company have soared in recent months, saddling Pershing Square with a roughly $300 million paper loss.
But the jury is still out on the investment, Ackman insisted.
“Over the past eight months, we have made material progress in attracting federal, state and international regulatory interest in Herbalife,” he wrote. “We are not at liberty to disclose the nature of these developments, but we believe that the probability of timely aggressive regulatory intervention has increased materially.” Ackman added that he has been in touch with a former Herbalife employee he deemed a “whistle-blower.”
And he made no apologies for the raft of sometimes-unfavorable coverage he’s received, calling it “a natural outcome of our high-profile strategy.”
“Activist investing requires a thick and calloused skin, and recent press coverage reinforces this point.”
Nov 4 2014 | 9:45am ET
Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…
Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...