Herbalife Investigation: Which Activist Is Right?

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March 12 (Bloomberg) -- Herbalife, the nutrition company that hedge fund manager Bill Ackman has accused of being a pyramid scheme, disclosed that the U.S. FTC has started a civil probe into its practices. Bloomberg Contributing Editor Bill Cohan takes a look at the differing views about the company on Bloomberg Television's "Street Smart." (Source: Bloomberg)

All activist stories.

They're all involved.

They all have been involved.

Quest that is right.

Dan loeb has been in the trade.

Quest carl icahn is still in his far as we know.

We know carl icahn and bill ackman did -- do not like each other.

It is well beyond just herbalife at this point.

Quest george soros also.

Quest there are a lot of big names.

It has not gone particularly well for bill ackman.

So far.


Quest today may be a turning point.

Quest spends a lot of money lobbying in washington.

The ftc opening up inquiry into this.

What might they find?

What is he hoping they find?

I do not know anything about the company more than i read.

Phil akerman's you is this is a pyramid scheme and should be put out of business.

That its stock should trade 20. he has that it will go that way.

He has been pushing for the last 16 months to see if he can make it happen.

It has not worked yet.

The stock has gone in exactly the opposite direction than what he hoped it would go.

He has lost hundreds of millions of dollars.

He hedged out some of the rest of his position.

Bill akerman is the guy who bet against an bia for seven years and everybody told me was crazy and he was right and he stuck with it.

At what point do you as an investor throw in the towel and say, enough?

This particular stock, ever so slightly different because there is probably more ego here at play.

There is a lot of ego.

Class a very public battle between the two of them.

Carl icahn coming out very harshly on the show.

There is a lot going on.

At what point did bill say ok, i have lots of money and it is time to call it a day?

Class i do not think he -- he is not the kind of guy who will throw in the towel.

How much are you willing to lose?

Are you missing too much at any point?

Builder not have as good a year as others had, but he still had a good year.

He had canadian pacific.

He has had hair products.

He has had a bunch of really big winners.

He had herbalife and jcpenney.

He bounces the winners with the losers.

He is a guy with religious fervor and you have to be to do it he does.

He is an activist.

He has religious fervor.

He believes the company is an illegal pyramid scheme to be put out of business and he is using every trick in the book to make it happen.

He has now got the holy grail from his perspective.

The fcc.

He has been working on this for 16 months.

He has been lobbying and lobbying.

They all do that.


The company is also lobbying and they outspent.

Everybody is lobbying.

It is a war.

Quest in the meantime, you get washington and they're taking some heat for this and people are pointing fingers and saying, you must be in bed with the activist investors because you're out there trying to help them make money.

Class on the other side of that is bill akerman believes people who use the product are being taken advantage of and hurt.

He is trying -- he claims he is -- altra stick.

Quest he believes it.

He has even said he will give his personal -- any profits he makes, personal to charity.

He gave $25 million to the foundation where he made this public in december of 2012. like it or not, the guy is at least, he believes it is a holy war and he has taken it to the streets.

He may be wrong or right.

It is like the whole community gained up against him.

You look at soros an icon.

All of the people now involve him alongside of the trade or having been involved at some point.

Christ they are smart.

They have made money at his expense.

They saw an opportunity and took advantage of it because bill was so big on the short side they saw an opportunity.

Quest was it making money or stick to bill?


If your buddy really wanted to stick it to go, he would have

This text has been automatically generated. It may not be 100% accurate.


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