Valeant To Be Sold? Ackman Hints At It

• Shares of Valeant Pharmaceuticals Intl Inc (NYSE: VRX) were trading higher by 2 percent early Friday morning.
• The stock is still lower by more than 50 percent over the past month.
• The New York Post reported that Bill Ackman hinted at a possible sale of the company.

Shares of Valeant Pharmaceuticals were trading higher Friday morning after activist investor and large shareholder Bill Ackman hinted at a possible sale of the company.

Ackman's hedge fund, Pershing Square, has taken a $2 billion loss so far in its Valeant investment.

According to New York Post, the investment manager wrote a letter to the company's CEO Michael Pearson praising his leadership. He wrote "you have assured me that you and the rest of the board are considering any and all alternatives that would benefit shareholders."

See Also: Bill Ackman To Valeant's CEO: Your Reputation Is At Grave Risk

They key word in Ackman's letter is "alternatives." The term is synonymous with a sale or breakup of the company. The possibility of a sale or breakup typically attracts short-term investors looking to make a quick profit and could also frighten short-sellers into covering their positions.

"You are one of the most shareholder-oriented CEOs I Know," Ackman also told Pearson in his e-mail.

Ackman said during a conference call last week that a joint Pfizer Inc. (NYSE: PFE) - Allergan PLC (NYSE: AGN) entity would be a "great buyer" for Pfizer. He also said that as a stand-alone company, Valeant's stock has an 80 percent upside if the company were to "just run the business, buy back stock and don't buy anything new."