Philip Falcone’s hedge funds sold $158 million of Harbinger Group Inc. (HRG) shares to Leucadia National Corp. (LUK) as the manager moves to liquidate assets after reaching a settlement with U.S. regulators.
Three funds run by Harbinger Capital Partners LLC sold a combined 18.6 million shares of Harbinger Group, a publicly traded holding company run by Falcone, for $8.50 a share, according to a Securities and Exchange Commission filing today. The transaction makes Leucadia the second-largest holder, with a stake of about 13 percent in the New York-based company that runs businesses including life insurance and pet supplies, according to data compiled by Bloomberg.
Falcone, 51, and Harbinger Capital agreed last month to meet redemption requests under the supervision of an independent monitor as part of an $18 million settlement with the SEC. The settlement also includes a five-year ban from the securities industry and an admission of wrongdoing for improperly borrowing money from his funds to pay his personal income taxes.
Leucadia agreed last year to buy Jefferies Group LLC in a $3.2 billion deal that put Richard Handler, who was running the investment bank, in charge of the combined company when the transaction was completed in March. New York-based Leucadia also has investments in industries including beef processing.
The hedge funds sold an additional 5.1 million shares to other, undisclosed investors, according to the filing.
Harbinger Group rose 0.5 percent today to $10.06 in New York trading. The shares have climbed 31 percent this year.
Steven Goldberg, a spokesman for Harbinger at RLM Finsbury, declined to comment on the transaction. Laura Ulbrandt, a spokeswoman for Leucadia, didn’t immediately return a call seeking comment.