RPT-UPDATE 2-Valeant meltdown costs investors billions; Ackman ups stake
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By Svea Herbst-Bayliss
BOSTON Oct 21 (Reuters) - A precipitous plunge in the stock price of Valeant Pharmaceuticals International Inc cost some of Wall Street's top names billions of dollars on Wednesday but hedge fund manager William Ackman took the meltdown as a buying opportunity.
The billionaire, famed for his brash bets, swept up 2.1 million additional shares as the Canadian-based company plunged as much as 40 percent on a report from an influential short-seller that it may have fraudulently inflated revenues.
The purchase means Ackman's Pershing Square Capital Management is now the company's second-largest shareholder, leapfrogging asset manager T.Rowe Price. Pershing Square Holdings confirmed late on Wednesday that the company acquired in excess of two million shares of Valeant
Ackman lost about $500 million in Wednesday's rout and the source familiar with Ackman's fund said his Valeant bet is down about $1.4 billion so far this year.
"The guy eats nails for breakfast," one investor said of Ackman, who last year was among the hedge fund industry's top performing portfolio managers.
Valeant's market capitalization decline on Wednesday was $9.62 billion.
Ackman, renowned for betting $1 billion against nutrition company Herbalife and waging a public campaign to see his gamble through, is now, indirectly, on the receiving end. Continued...