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, J.C. Penney, Pershing Square Capital Management, strongly-worded letters
Just two-plus weeks after J.C. Penney’s board—of which the Pershing Square Capital Management chief is a member—agreed to take their time to find a replacement for the man he hand-picked for the job, Bill Ackman is getting impatient. It might occur to a lesser man who had picked a candidate he generously described as “very close to a disaster”—most people familiar with Ron Johnson’s J.C. Penney would probably have omitted the first three words—that discretion is be the better part of valor in this case, but Bill is unafraid. He’s made more powerful enemies than the man he obviously sees as the lame duck chairman of a failing retailer that he owns 18% of and whose replacement he has already found. Read more »
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 »
Tags: Bill Ackman, Carl Icahn, Dan Loeb, enemas, good intentions, hedge fund managers, Herbalife, Pershing Square, the doctor will see you now, Third Point
Earlier today, a person, if a person were so inclined, could hop on his or her Bloomberg terminal, start a message to hedge fund manager Dan Loeb, and be greeted with a header that proclaimed “New HLF Product: The Herbalife Enema, Administered by Uncle Carl.” This line was an obvious reference to the figurative enema Pershing Square chief Bill Ackman has undergone at hands of the shake and supplement company and fellow money manger, Carl Icahn. After a flurry of articles pointing out Loeb’s anus-themed diss, the Third Point manager’s header was changed to “Always take the high road.” While one might quick to assume this meant Loeb had had a change of heart re: his previous statement, and had felt it’d been a less than diplomatic thing to say, doing so would make an ass of you and me. Read more »