Tags: Bill Ackman, Borders, charts, Herbalife, JCPenney, letters to investors, mistakes, Pershing Square, Retail, Target, thick and calloused skin
There comes a time in every hedge fund manager’s life when he must admit that he made a mistake. Sometimes that mistake was borrowing money from an investor fund to pay personal taxes. Sometimes that mistake was knocking off that hooker. Sometimes that mistake was thinking investors would be happy to hear that their one dollar at the beginning of the year was now just 17 cents. The point is, they erred in judgment, and while it’s unusual for men of their stature to admit such a thing, on the record or otherwise, they decided to step up and do just that.
For Bill Ackman, yesterday was sort of that day. Read more »
Tags: activism, Apple, Bill Ackman, Carl Icahn, Hedge Funds, Twitter
Once upon a time before there were activist hedge funds there were corporate raiders, whose business model was
- buy stock in company,
- be annoying,
- sell stock back to company at higher price.
This model had many delights of which perhaps the greatest was that you couldn’t really, like, do damage to your reputation. The more annoying you are: the more the company wants to get rid of you! So the more they’ll pay. And since you’d really only get into this business if you had some natural predisposition to annoyingness, it was a nice way for some people to make a living doing what they loved. Sadly it sort of petered out after the 1980s, though you still see variants on it occasionally.
It’s fun to contrast Bill Ackman’s 2,000-word letter to the J.C. Penney board referencing his previous “several-thousand-word email to the board outlining my concerns about our current trajectory” with Carl Icahn’s 280 characters about Apple. Read more »
Tags: Bill Ackman, George Soros, I mean really!, is he supposed to do everything around here?, Pershing Square, redemption requests, Soros Fund Management, that came out of nowhere
Soros Fund Management LLC is withdrawing its money with William Ackman’s Pershing Square Capital Management due to performance, according to a person close to the matter. Pershing is in the process of returning the money to Soros, less than $250 million, by early 2014, the person said. [Reuters, earlier: "Bill Ackman has filed a complaint with regulators against George Soros’ family fund and unidentified co-conspirators alleging Soros’ firm broke insider-trading rules by tipping hedge funds"]
Tags: Bill Ackman, Carl Icahn, George Soros, Herbalife, market manipulation, Paul Sohn
There are puzzling reports that Bill Ackman has been complaining to the SEC about George Soros’s investment in Herbalife, claiming that “Soros’ firm broke insider-trading rules by tipping hedge funds about its purchases” at “idea meetings.” You might remember Bill Ackman as the man who called a big press conference to tell everyone that he was short Herbalife and they should join him. There was PowerPoint! It was like eight hours long. I suppose some people traded on it though I also suppose they regret it.
So what’s his problem? I do not understand this at all. The allegation of insider trading is particularly weird; as far as I know no one has any obligation to keep their share ownership – or plans to buy more shares – secret. A cynic might say that the business of fundamental equity fund management consists mostly of telling people about your positions, which is why CNBC exists. It’s also why Ackman’s Herbalife drama exists; one irony is that if he had not called that press conference he probably would never have baited Carl Icahn into becoming Herbalife’s biggest proponent. Should have kept it to an idea meeting! Read more »
Tags: Bill Ackman, enemas, Herbalife, Pershing Square Capital Management, pop quizzes
The “pyramid scheme” known as Herbalife has now cost Bill Ackman’s investors something like $300 million, thanks in part to its “best quarter ever.” Of course, that plaudit depends on actually believing the things said in Herbalife’s unaudited financial statements, and luckily for Bill Ackman, he does not. And has a few questions. Read more »