Icahn buys 14 million shares in Herbalife, eyes options for company

NEW YORK Thu Feb 14, 2013 6:46pm EST

Traders work at the post that trades Herbalife stock on the floor of the New York Stock Exchange in this January 10, 2013 file photograph. REUTERS/Brendan McDermid/Files

Traders work at the post that trades Herbalife stock on the floor of the New York Stock Exchange in this January 10, 2013 file photograph.

Credit: Reuters/Brendan McDermid/Files

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NEW YORK (Reuters) - Carl Icahn on Thursday put his money where his mouth is.

The billionaire investor said in a regulatory filing that he owns 14 million shares, or 13 percent, of weight-loss and vitamin company Herbalife Ltd. (HLF.N) and signaled that he is ready to help put the company in play.

After weeks of speculation over exactly what the famed corporate raider might be doing, Icahn spoke up and put himself on a collision course with William Ackman, a rival activist investor who called Herbalife a house of cards and said he sees the share price going to zero.

The two men famously tussled on cable television in late January when Icahn called Ackman a "major loser" and warned him of trouble ahead in the form of a major short squeeze.

Herbalife's share price surged 20.6 percent in the wake of Icahn's filing, trading at $46.15 after the market closed.

Icahn said he wants to meet with Herbalife's management "regarding the business and strategic alternatives to enhance shareholder value, such as a recapitalization or a going-private transaction."

The company said: "We welcome all parties who see the same value in Herbalife that we do."

One short squeeze has already occurred, experts said.

(Reporting By Svea Herbst-Bayliss with additional reporting by Martinne Geller and Sam Forgione; Editing by Xavier Briand)

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Comments (1)
Harry079 wrote:
“Icahn said he wants to meet with Herbalife’s management “regarding the business and strategic alternatives to enhance shareholder value, such as a recapitalization or a going-private transaction.”

I don’t know but wouldn’t it been a better idea to meet with Herbalife before buying all those shares?

There was a similar thing going on in the not so distant past with another company that most people didn’t understand their business model.

I think it was called ENRON.

Back in the 80′s Herbalife used to run these 1.5 hour info-mercials on cable at 3 in the morning. They would shows thousands of Herbalife people in a arena with a big screen and people testifying how they became rich selling Herbalife.

Since Herbalife is in over 100 countries now maybe they just haven’t run out of people to believe the Herbalife story.

Feb 14, 2013 9:47pm EST  --  Report as abuse
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