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Hedge fund manager Bill Ackman gave another presentation on Herbalife—a multi-level marketing company that he's betting $1 billion will go under.
Ackman, who runs Pershing Square Capital, declared over a year ago that he's shorting Herbalife because he believes the company operates as a "pyramid scheme."
Herbalife has publicly denied Ackman's allegations.
So far, the short hasn't played out in his favor either. He's lost an estimated $500 million in mark-to-market losses.
His latest presentation focuses on Herbalife's business practices in China. In short, Ackman believes that the nutrition company is violating Chinese direct-selling laws.
Specifically, Pershing Square alleges that Herbalife violates Chinese laws by doing the following:
- "Paying multi-level, royalties based upon unlimited downline levels"
- "Paying royalties and commissions totaling more than 30% of sales volume."
- "Incentivizing Distributors to recruit a potentially infinite downline in order for Distributors to reap sales-based 'Consulting Fees'"
- "Permitting and incentivizing individual Distributors to recruit other participants."
We've included his slidedeck. This time it was only 56 slides compared with his famous 342-slide presentation when he first unveiled his short thesis.
Image may be NSFW.Clik here to view.
Image may be NSFW.
Clik here to view.
Image may be NSFW.
Clik here to view.
See the rest of the story at Business Insider
