Monday was a major day of reckoning for
Pershing Square Capital Management’s Bill
Ackman. The high-profile activist investor finally threw in the
towel on his ill-fated, performance-draining investment in
embattled drug maker Valeant Pharmaceuticals International,
selling his entire stake. In a press release, Pershing Square
also said Ackman and vice chairman Steve Fraidin will not stand
for re-election to the board of directors at the
company’s upcoming annual meeting. Valeant
currently accounts for 1.5 percent to 3 percent of the various
Pershing Square funds, the firm said. "However, the investment
required a disproportionately large amount of time and
resources," it added in its announcement.
Pershing Square, of course, will realize a large tax loss
from the sale. At year-end, Pershing Square was the
third-largest Valeant shareholder, with more than 18.1 million
Paulson & Co. was the second-largest shareholder, while
ValueAct Capital was the fourth-largest shareholder. The
stock closed at $12.11 on Monday, down a little more than 1
percent. It is down nearly 17 percent this year alone after
dropping more than 80 percent last year. Ackman has lost $4
billion on the investment. After the closing bell
yesterday, Ackman sold 27.2 million shares at $11 a share,
according to published reports
Meanwhile, on the same day Ackman suffered a setback on
another one of his high profile investments. Carl Icahn
disclosed he bought more than 372,000 shares of Herbalife on
Friday for $51.35 per share. As a result, Icahn’s
investment vehicles collectively control 24.57 percent of the
total number of outstanding shares of the controversial
multi-level marketer of nutrition and health-related products.
Icahn purchased the stock when it dropped to just above its
Of course, Pershing Square famously has a huge negative bet
on Herbalife’s stock, asserting that the company
is a Ponzi scheme. And sure enough, the shares surged 2.7
percent on the news of Icahn’s purchase, closing
Monday at $53.68. This is also down from a recent high of
$61.73 on February 15.
Pershing Square Holdings was down 1.5 percent for the year
through March 7.
Separately, Icahn disclosed he raised his stake in truck
maker Navistar to more than 17 percent. The stock rose 1.8
percent on the news, closing at $26.46. At year-end, Icahn was
already the largest shareholder.
Adage Capital Management boosted its stake in Fluidigm to
1.546 million shares, or 5.29 percent of the maker of
biological research equipment. The investment is passive.
Sandell Asset Management filed an updated 13D filing on Bob
Evans Farms. It said it owned 1.263 million shares or so of the
restaurant chain, or 6.4 percent of the total outstanding, as
of March 9. This is down from the 8.1 percent it reported
owning in early December. However, the activist hedge fund
disclosed on February 24 in its quarterly 13F filing that it
owned the same 1.263 million-share stake in the company as of
year-end. Turns out the new filing was made to show it no
longer holds stock options that it had also owned at
Caxton Associates founder Bruce Kovner is looking to sell
his Caribbean property on the island of St. Barthélemy
for $67 million, according to the Wall Street Journal.
The property resides on 7.5 acres. Macro pioneer Kovner, who
retired at the end of 2011, recently had a home built in
Florida, according to the report.