Activist investor Carl Icahn has sold more than half his stake in Herbalife Nutrition back to the company for $600 million at $48.05 a share and has given up the five seats on the firm’s board held by his representatives, Herbalife said in a statement.
Icahn had a 15.5 per cent stake in Herbalife as of Sept. 30. The latest deal is expected to close by January 7, after which Icahn Enterprises will hold about 8 million of Herbalife’s shares, representing a stake of about 6 per cent, the statement added.
The Wall Street Journal reported on Sunday that in recent days Icahn had sold about 10 per cent of his stake back to the multi-level marketing company, whose products include dietary supplements.
Icahn’s remaining stake is worth about $400 million, according to WSJ on.wsj.com/3b4a4UR.
Icahn began buying Herbalife shares in 2013 while extolling the company and had since been its largest shareholder.
In 2013, Herbalife and Icahn Enterprises entered into a support agreement that allowed Icahn Enterprises to have five board seats for as long as it held at least 14 million Herbalife shares.
With Icahn’s stake now falling below the threshold of 14 million shares, the support agreement has been terminated and the activist investor’s board representatives have stepped down, Herbalife said on Sunday..
Icahn said that the time for activism at Herbalife “has passed”.
“At the time (when he started investing in Herbalife), I believed the company was in need of an activist and that certainly turned out to be correct”, Icahn said on Sunday.
“The time for activism has passed as the company has grown, and I don’t typically invest billions of dollars in companies where our role as activist is not needed,” he added.
Icahn is estimated to have made a total of $1 billion on his 7-year investment in the network marketing company, having won a major battle against another investor when he bought in to Herbalife.
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