Market Overview

Bill Ackman Exits Herbalife, Builds New Stake In United Technologies

Bill Ackman Exits Herbalife, Builds New Stake In United Technologies

Bill Ackman had quite the hump day.

The billionaire activist investor confirmed with CNBC his firm Pershing Square has been building a stake in the aerospace giant United Technologies Corporation (NYSE: UTX). He also said his five-year long short thesis on Herbalife Ltd. (NYSE: HLF) has come to an end.

United Technologies

Ackman said United Technologies is a "great" company but was short on offering further details, according to CNBC's Scott Wapner. It's also unclear if Ackman held any talks with United Technologies' senior leadership team.

A spokesperson for Pershing Square had no comment when reached by Benzinga.

The timing of Ackman's confirmation of building a stake could in theory be related to the company's recent comments that it's looking to split up key parts of the business -- although nothing can be confirmed yet, Wapner said.

Stephen Weiss, founder and Managing Partner of Short Hills Capital, said on CNBC that United Technologies' recent comments of looking to split up the business "makes sense." This would position the company to either be a "pure defense play" or a "pure aerospace play."

At time of publication, United Technologies was trading up about 1.7 percent at $136.25.


Ackman's short thesis against Herbalife dates back to 2012. Over the years he presented the public with new information which supported his thesis that the stock's value should fall to zero. The multi-year battle has come to an end, however, as Ackman also confirmed with Wapner his firm completely unwound its position, including put options.

Ackman closed his short position on Herbalife last year, but held on to put options which would have earned his firm a profit if Herbalife's stock declined.

At time of publication, Herbalife was trading up more than 9 percent at $94.91.

Related Links:

Q4 13F Roundup: How Buffett, Einhorn, Loeb, And Others Adjusted Their Portfolio

Pershing's Bill Ackman: 'Herbalife's Business Will Ultimately Fail'


Related Articles (HLF + UTX)

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