Tracking to the steep drop of over 25 percent in competitor Nu Skin shares, Nutrition company Herbalife Ltd's stock also plunged over seven percent.
Herbalife Ltd, the marketer of weight-management products, energy drinks and nutrition supplements that has come under investigation by the Federal Trade Commission as well as other agencies, has hired a former FTC official as its chief compliance officer.
Despite getting clearance from accounting firm PricewaterhouseCoopers LLP regarding its fiscal statements for the last three years, activist investor Bill Ackman appeared to be not convinced that Herbalife Ltd is not operating a pyramid scheme.
Bloomberg said in its report that nutrition company Herbalife Ltd attempted to destroy activist investor Bill Ackman's credibility after the latter claimed that the former is running a pyramid scheme.
Investors showed support in nutrition company Herbalife International on the stock exchange on Friday despite another attack from activist investor Bill Ackman of hedge fund Pershing Square Capital Management.
A Reuters report said hedge fund managers in the US bought and exited from shares of hotly-debated firms like retailer JC Penney, nutrition and weight management company Herbalife Ltd and auction house Sotheby's.
Herbalife Ltd fourth largest shareholder Bill Stiritz said he would most likely take part in a leveraged buyout of the company, as the nutrition company is in the middle of pyramid scheme accusations by hedge fund manager Bill Ackman.