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Herbalife, Michael Johnson, Bill Ackman
CEO Michael Johnson, in August 2015 at Herbalife’s Los Angeles headquarters.  Photograph by Michael Lewis for Fortune

Herbalife’s CEO Is Going to Step Down After a Tumultuous 13 Years

Nov 02, 2016

Herbalife (hlf) Chief Executive Michael Johnson will step down next year, capping a tumultuous 13-year tenure that was marked by a bitter fight with activist investor William Ackman.

Johnson will step down next June and will take up the role of executive chairman. He will be replaced by Chief Operating Officer Richard Goudis.

Goudis took over as COO in 2010, following a five-year stint as chief financial officer.

Billionaire investor Carl Icahn, who disclosed a 20.78% stake in the company in August, said he fully supported the board's choice of Goudis as the next CEO.

The dietary supplements maker's shares were down 1.7% in after-market trading on Tuesday after the company also reported a 6.3% drop in third-quarter net income.

Ackman and Icahn have opposing bets on Los Angeles-based Herbalife. Ackman for years has accused Herbalife of running a pyramid scheme and bet that the stock would fall to zero.

Icahn famously called Ackman a "liar" and a "crybaby" in a CNBC interview in 2013. They have since made up.

The U.S. Federal Trade Commission opened a probe into Herbalife in 2014 following Ackman's allegations.

The company, in July, agreed to pay $200 million and change the way it does business to avoid being labeled a pyramid scheme by regulators.

Herbalife's net income fell to $87.7 million, or $1.01 per share, in the third quarter ended Sept. 30, from $93.6 million, or $1.09 per share, a year earlier.

On an adjusted basis, the company's earnings were $1.21 per share, topping the average analyst estimate of $1.09, according to Thomson Reuters I/B/E/S.

Revenue rose 1.7% to $1.12 billion.

The company, however, raised its full-year forecast for adjusted profit to a range of $4.65-$4.85 per share from $4.50-$4.80.

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