BUFFALOED BILL
Icahn buys Herbalife stock in blow to Ackman
Just when you thought thehe Herbalife war was over, bil-illionaires Carl Icahn and Bill Ackman took up battle sta-tations again.
Ackman, who has a $1 bil-lion short on Herbalife, fired the first shot on Friday morning when he claimed bankers for Icahnn had approached him aboutut buying some of the billion-naire’s stake in Herbalife.
The head of Pershingng Square Capital Managementnt appeared on CNBC, whereere he bolstered a Wall Streeteet Journal report that said Icahnhn was mulling a sale of his 18 percent stake in the nutritionon products maker to a group of investors including Ackman.n.
Ackman claimed that bank-nkers at Jefferies & Co. came toto him with the idea and that he considered buying some of the shares just to get Icahnhn out of the picture.
Asked why Icahn woulduld want to sell, Ackman said: “I think he knows this is toast.”.”
Herbalife’s stock initiallylly fell as much as 7 percent on the report, boosting Ack-ckman’s short position.
Then Icahn fired back. Not only is he sticking with Herbalife, Icahn said he bought 2.3 million more shares during Friday’s drop, boosting his stake to 20.8 percent.
In a statement released after the market close, Icahn said that although bankers frequently make bids for his large positions, he never ordered a sale of Herbalife shares.
Worse, Icahn accused Ackman of misleading investors, saying he had allowed his “obsession with Herbalife” to cloud his judgment.
“It amazes me that a guy who hasn’t any knowledge of my internal investment thinking believes he is in a position to go on television to tell the world what I am thinking!” Icahn wrote.
Herbalife’s shares, which closed down 2.3 percent at $60.50, rose as much as 5.8 percent in after-hours trading Friday.
Pershing Square declined to comment.
Friday is the latest chapter in the nearly four-year battle between the billionaires. The two famously hurled insults at each other on-air in 2013, when Icahn called Ackman a “crybaby in the schoolyard.”
Ackman disclosed his short bet against Herbalife in December 2012, claiming the company was a pyramid scheme and regulators would shut it down.
Icahn took the other side of the trade and built up his stake when the stock was trading in the low $30s.
Things have worked out far better for Icahn, who would have made $450 million had he sold his stake based on Friday’s closing price.
Last month, the Federal Trade Commission wrapped up its two-year investigation into Herbalife. While the agency demanded changes to the company’s business model, it stopped short of calling it a pyramid scheme.
A fuming Ackman accused Icahn and Herbalife of manipulating the stock price by issuing misleading statements over the FTC’s ruling.
“You have the CEO of a public company and a controlling shareholder misleading the public and you can see the impact — the 22 percent rise in the stock price on the public being misled,” Ackman said during a call with investors.