Hedge fund billionaire Bill Ackman vowed to take a "much more proactive role" at Valeant Pharmaceuticals (VRX) amid a stunning stock decline that cost him more than $1 billion in a single day.
The drug company's stock closed down 51% to $33.54 a share Tuesday on disappointing financial news, including a warning that a late filing could lead to bond defaults that may hurt the company's ability to borrow money. The loss shaved a whopping $35.50 off each share.
For Ackman's Pershing Square entities, which own 30,711,122 Valeant shares, that translates to a paper loss of $1.09 billion.If they can get through the bond default risk and finally issue their annual statement their stock might be worth buying at these levels. It isn't like Lumber Liquidators (LL) who is fighting the US government on the formaldehyde in their Chinese made wood. This is a company that was making billions before they got into trouble with their captive drug retailer Philidor that they have since shuttered.