Herbalife CEO Claims His Company Isn’t a Pyramid Scheme

In December 2012, Pershing Square Capital Management’s William Ackman gave a presentation explaining he was shorting Herbalife stock because the company is essentially a pyramid scheme. A PDF version of Ackman’s 300+ slide presentation is available on FactsAboutHerbalife.com and it is a thorough takedown of the company and its business model.

Herbalife’s stock price fell almost 10 percent the day of the presentation (Ackman has pledged that any personal profits he makes off the Herbalife short will go to chairty).

In a press release, Hebalife CEO Michael Johnson responded that in no way, shape or form is Herbalife a pyramid scheme,

The allegation that Herbalife is a pyramid scheme is bogus. Make no mistake: Today’s announcement isn’t about Herbalife’s business model. It’s about Bill Ackman’s business model.

And, if you believe that I’ve got some diet pills to sell you…