Bloomberg News

Perry Capital Said to Build Herbalife Stake Opposed to Ackman

August 20, 2013

Perry Capital LLC, which sided with activist investor Bill Ackman in his effort to remove J.C. Penney Co.’s chief executive officer, has taken a stake in Herbalife Ltd. (HLF:US) in opposition to Ackman, said a person with knowledge of the purchases.

The person, who asked not to be identified because the position hasn’t been publicly disclosed, said Perry’s stake was less than 5 percent and didn’t say when it was acquired. The shares climbed 3.9 percent to $64.72 today at the close in New York, after CNBC reported the purchase. The company’s stock has almost doubled this year.

Ackman has sold Herbalife shares short, seeking to profit from their decline, and said the Cayman Islands-based company is an illegal pyramid scheme that should be shut down. Herbalife has repeatedly denied the allegations. Richard Perry, founder of Perry Capital, joins hedge fund managers Carl Icahn and George Soros in betting against Ackman.

Icahn, Herbalife’s largest individual investor, owns a 16 percent stake, according to data compiled by Bloomberg. Perry Capital didn’t own any Herbalife shares as of June 30, according to a U.S. Securities and Exchange Commission filing.

Perry reported a 7.3 percent stake in J.C. Penney on Aug. 9 and echoed Ackman’s comments that the board should quickly seek to overhaul its management, including naming a replacement for CEO Mike Ullman.

To contact the reporters on this story: Duane D. Stanford in Atlanta at dstanford2@bloomberg.net; Katherine Burton in New York at kburton@bloomberg.net

To contact the editor responsible for this story: Robin Ajello at rajello@bloomberg.net


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Companies Mentioned

  • HLF
    (Herbalife Ltd)
    • $67.77 USD
    • 13.75
    • 20.29%
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