Tags: Post | Herbalife | Stake | Talks

Post CEO Lifts Herbalife Stake, Seeks Talks

Tuesday, 19 November 2013 06:13 PM EST

Bill Stiritz, chief executive officer of Post Holdings Inc., the Raisin Bran maker, raised his stake in Herbalife Ltd. to 6.4 percent and said he will seek talks with the nutrition company.

Discussions may include potential financing and share repurchase strategies, as well as ways to leverage Herbalife’s product distribution, Stiritz said in a filing Tuesday. Stiritz, who previously reported a 5.3 percent stake, is Herbalife’s fifth-largest shareholder.

Stiritz said last week that he’s willing to take part in a leveraged buyout of the company that would reward shareholders and help Herbalife fend off allegations by hedge fund billionaire Bill Ackman, who for a year has accused it of operating an illegal pyramid scheme. Herbalife, which makes vitamins, skin creams and meal-replacement shakes and operates in more than 80 countries, has denied Ackman’s claim.

Stiritz, 79, has “analyzed the company and concluded that it has a sound business model, a strong distribution system and a positive outlook for long-term growth opportunities,” according to the filing. “The company’s market capitalization is undervalued at this time.”

Ackman’s Pershing Square Capital Management LP initially sold short at least 20 million Herbalife shares. Ackman has since reduced the equity short position in the company while maintaining his bet through options. He has urged U.S. regulators, elected officials and community activists to help shut it down.

Herbalife, based in the Cayman Islands, rose 2.8 percent to $67.80 at 4:53 p.m. New York time in extended trading, after the filing was disclosed. The shares had fallen 1.8 percent to $65.97 at the close.

© Copyright 2024 Bloomberg News. All rights reserved.


InvestingAnalysis
Bill Stiritz, chief executive officer of Post Holdings Inc., the Raisin Bran maker, raised his stake in Herbalife Ltd. to 6.4 percent and said he will seek talks with the nutrition company.
Post,Herbalife,Stake,Talks
257
2013-13-19
Tuesday, 19 November 2013 06:13 PM
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