Matt Levine, Columnist

Stock Buybacks and Securities Fraud

Also value and momentum, IEX listings, Martin Shkreli, eclipse jokes and crypto-tokens.

August 22, 2017 at 1:30 PM UTC

Matt Levine is a Bloomberg Opinion columnist. A former investment banker at Goldman Sachs, he was a mergers and acquisitions lawyer at Wachtell, Lipton, Rosen & Katz; a clerk for the U.S. Court of Appeals for the 3rd Circuit; and an editor of Dealbreaker.

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Herbalife.

Herbalife Ltd. has always been a bit of an innovator in stock buybacks, and it announced a fun one yesterday. The buyback is a $600 million self-tender-offer via a Dutch auction, in which it will pay between $60 and $68 per share depending on investor interest. The innovation is that "for each share tendered, shareholders will also receive a non-transferable contractual contingent value right ('CVR') allowing participants in the tender offer to receive a contingent cash payment should Herbalife be acquired in a going-private transaction within two years of today’s commencement of the tender offer":