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Valeant Pharmaceuticals: Ackman Ups Stake, While ValueAct Digs In
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Ted Eytan Dr. Tim Grayson, Kaiser Permanente Rock Creek, Lafayette Colorado 19650Tim Grayson, MD, is the Chief of Dermatology, Kaiser Permanente, Colorado. via Flickr
Valeant Pharmaceuticals still has plenty of supporters despite the media storm surrounding the company and its businesses practices.
Last night it emerged that Bill Ackman, one of Valeant’s most staunch supporters, has upped Pershing Square’s stake in Valeant to 9.9% of the company’s outstanding shares (Shane Obata has a nice explanation of the complex math)– a near 70% increase in Pershing’s holding before recent declines
Bill Ackman’s Pershing Square is now Valeant Pharmaceuticals’ second largest shareholder
Bill Ackman’s Pershing Square is now Valeant’s second largest shareholder after the Sequoia Fund , which is run by Ruane, Cuniff & Goldfarb. The famed value firm, Sequoia Fund, itself has come under fire for its Valeant position. Two of the fund's five independent directors resigned during October after the concerns about Valeant’s business model started to surface. The outgoing directors had previously questioned whether Sequoia should have such a large position in the company.
On the other hand, Bill Ackman doesn’t seem to have nearly as many concerns about Valeant’s business model.
The activist investor held a three-hour (what some called a “rambling”) conference call on October 30 to defend his investment in Valeant Pharmaceuticals and to answer investors’ questions. He also wrote to Valeant’s CEO Michael Pearson earlier this month expressing confidence in Pearson’s leadership.
“You are one of the most shareholder-oriented CEOs I know…You have assured me that you and the rest of the board are considering any and all alternatives that would benefit shareholders and other stakeholders.”