Harbinger Skirts $100M Loss On Satellite Co.

Mar 8 2011 | 5:46pm ET

Harbinger Capital Management's timing in dumping its last stake in satellite operator Inmarsat could not have been better.

The New York-based hedge fund last month renegotiated its lockup period with Inmarsat, which it once hoped to acquire and combine with its own LightSquared satellite business, dumping its remaining 14% stake on Feb. 8. The move—convincing Credit Suisse and UBS to end the lockup two months earlier—has paid off in a big way.

Inmarsat shares dropped 13% yesterday after the company warned that customers were reducing their use of satellite phone calls in favor of e-mail. Had Harbinger been forced to hold its remaining stake until April 7, it would have lost £66 million, or more than US$100 million, on the decline.

Harbinger sold the first half of its 28% stake in Inmarsat in October.

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