Ackman's Herbalife Analyst Quits

Jan 29 2014 | 10:02am ET

Shane Dinneen, the architect of Pershing Square Capital Management's huge short bet against Herbalife, has left the hedge fund.

Dinneen, an analyst at the New York-based firm, did much of the original work on the $1 billion bet on Herbalife, which Pershing Square founder William Ackman has called a pyramid scheme. Since announcing the short, however, Herbalife's shares have rallied, costing Pershing Square hundreds of millions of dollars in paper losses.

Still, Ackman was effusive in his praise for Dinneen, who has worked at Pershing Square since 2008.

"As Shane is one of the most talented investment analysts I have ever worked with and someone I hold in high regard, I have done my best to convince him to stay with the firm," Ackman wrote. "Recently, he decided it was time for him to move on to areas of his own interest outside of activist investing."

It's not clear what Dinneen's plans are.

Dinneen's involvement with the Herbalife short had disappeared in the past year, Ackman wrote, as Pershing Square's legal team took the lead. Ackman said that he remains "convinced that the company has operated an illegal pyramid scheme since its founding" and that he is "encouraged by the recent regulatory developments concerning the company."

Dinneen's exit from Pershing Square follows the departure of one of the firm's chief adversaries from his firm. Analyst Tim Ramey, who has for years been bullish on Herbalife and who has taken a few swipes at Ackman, has left D.A. Davidson for Post Holdings, Herbalife's fourth-largest shareholder. It is thought that Ramey's move to Post could presage a buyout of Herbalife by that company—an outcome that would be disastrous for Ackman's—and Dinneen's—short bet.


In Depth

Steinbrugge: Top 10 Hedge Fund Industry Trends for 2017

Jan 3 2017 | 9:03pm ET

Each year, Agecroft Partners' Don Steinbrugge predicts the top hedge fund industry...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

DarcMatter: The Top Trends in Alternative Investments for 2017

Jan 13 2017 | 8:22pm ET

The $7 trillion alternative investments industry is poised for continued growth...

 

From the current issue of

The U.S. Commodity Futures Trading Commission (CFTC) ordered The Goldman Sachs Group Inc., and Goldman, Sachs & Co. to pay a $120 million penalty for attempted manipulation and false reporting of ISDAFIX Benchmark Rates, a global benchmark for interest rate products.