Herbalife Soars as Icahn Reveals Huge Stake
Carl Icahn filed a quarterly 13-F after the closing bell on Thursday showing his firm's long equity positions. While his 13-F was largely unchanged versus last quarter, an SEC filing showed that the investor had accumulated a 12.98 percent stake in embattled multi-level marketer Herbalife (NYSE: HLF).
The filing states that "The Reporting Persons intend to have discussions with management of the Issuer regarding the business and strategic alternatives to enhance shareholder value, such as a recapitalization or a going-private transaction."
The news confirmed previous market rumors that Icahn did in fact have a position in the stock. Last month, Icahn and Pershing Square Capital Management founder Bill Ackman engaged in a colorful argument live on CNBC where they delved into their shared animosity for one another.
Previously, Ackman had revealed that Pershing Square had a roughly $1 billion short position in Herbalife at an investment conference. He called the company a "pyramid scheme" and said his price target for the stock is $0.
Other prominent investors, among them Carl Ichan, clearly disagree with Ackman's thesis. Hot-shot hedge fund manager Dan Loeb's Third Point LLC also took a substantial stake in Herbalife in the wake of Ackman's disclosure.
While it is unclear if Icahn was motivated to invest in the company out of spite for Bill Ackman, surely his personal feelings were not completely taken out of the equation. In any event, the news of Icahn's roughly 13 percent stake in Herbalife has put the screws to Bill Ackman. In Thursday's after hours trading session, HLF was up around 20 percent to $45.90 in late trade.
The only new position that Icahn showed in his most recent 13-F, which provides a glimpse of his long equity portfolio, was oil-driller Transocean (NYSE: RIG). Icahn had a roughly $261 million investment in the Zug, Switzerland-based offshore drilling operator that was acquired in Q4 2012.
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