Third Point's Dan Loeb has taken an eight percent stake in Herbalife (HLF), according to a regulatory filing.
This disclosure pits Loeb, who successfully took on Yahoo (YHOO), against Pershing Square's Bill Ackman, who shorted more than 20 million shares of Herbalife, calling it a pyramid scheme and suggesting the stock will go to zero.
Loeb's disclosure comes a day before Herbalife will make big investor presentation in New York to respond to Ackman's allegations, which he made in his own lengthy presentation two weeks ago.
Herbalife shares fell sharply after Ackman revealed his short position on December 19, but have risen in the last week. Herbalife's stock rose sharply before the announcement, and again on the news. (Read more below the video.)
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Dan Loeb's Third Point was a clear hedge fund standout in a horrible 2012 for the industry as almost nine out of 10 managers underperformed the S&P 500.
Loeb used an activist position in Yahoo and the contrarian buying of Greek bonds to drive the firm's flagship fund to a 21 percent gain last year. The firm's more-leveraged Ultra fund posted an even bigger 34 percent return.
Ackman is admired for some outstanding trades, including his investment in General Growth, which saw a $60 million investment rise to $2.3 billion.
But for all his public successes, he also has had some misses. His recent bet on JC Penney has so far been a losing one. He also unsuccessfully went after Target.
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