Falcone Says ‘No Issues’ With Harbinger Redemptions

Nov 12 2010 | 11:02am ET

Harbinger Capital Management has moved to assuage client fears following news that three major investors were pulling their money from the $9 billion firm.

Hedge fund founder Philip Falcone yesterday assured investors that Harbinger would have no difficulty meeting the redemption requests filed by the Blackstone Group, Goldman Sachs and New York State Common Retirement Fund, among others. There are “no issues,” Falcone said, and his flagship fund will not have to sell its considerable illiquid investments to meet the redemptions, the Financial Times reports.

Harbinger Capital Partners manages about $3.4 billion, and some 90% of the fund is said to be invested in wireless and telecommunications companies. It is unclear how much money clients have filed to redeem; Goldman and the New York pension have asked for a combined $161 million.

The fund is down 16% this year.

Falcone’s confidence no doubt stems in part from Harbinger’s redemption policy. Investors may withdraw only 25% of their money per quarter, limiting the amount the hedge fund has to liquidate each redemption period.

Investors have expressed concern over the flagship’s concentration of telecommunications investments as well as its performance. There have also been fears about a $113 million loan Falcone took from another Harbinger fund, which he is liquidating, to pay his personal taxes. According to the FT, Falcone has since paid that money back, earning the closing fund a substantial return.


In Depth

Will Liquid Alts’ Performance Sustain Future Asset Flows?

Aug 25 2014 | 10:34am ET

Liquid alternative investment funds saw the highest percentage of capital inflows...

Lifestyle

Hedgies, Economists and Musicians Mingle At Milkin Mixers In Hamptons

Aug 25 2014 | 6:00am ET

Leave it to Michael Milken to bring some gravitas and sweat to the Hamptons -- along...

Guest Contributor

Looking Ahead: What’s In Store For Managed Futures?

Aug 22 2014 | 12:52pm ET

The last five years were phenomenal for investors in equity indices. Will the next...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

The time was right

Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.