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Omega Advisors trims position in Harbinger Group

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Omega’s 13G filings since October

Omega Advisors added to its position in Atlas Energy LP (ATLS) and Altisource Portfolio Solutions (ASPS). It disclosed stakes in Aspen Group (ASPU), Resource America, Inc. (REXI), and Arbor Realty Trust, Inc. (ABR). It trimmed positions in Chimera Investment Corporation (CIM), SandRidge Energy, Inc. (SD), and Harbinger Group (HRG).

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Omega Advisors and Harbinger Group

Leon Cooperman’s Omega Advisors trimmed its position in Harbinger Group (HRG) this month. The fund said it holds 10,811,163 shares via an amended 13G filing. The shares account for a 5.38% stake in Harbinger. This is down from the 11,126,857 shares per the fund’s 13F for the third quarter that ended in September 2014.

Overview of Harbinger Group

Harbinger Group (HRG) is a diversified holding company focused on acquiring businesses with attractive assets and considered undervalued or fairly valued and growing its acquired businesses. Harbinger Group operates in the following four segments:

  1. Consumer Products, which consists of Spectrum Brands
  2. Insurance, which includes Fidelity & Guaranty Life (or FGL) and FrontStreet
  3. Energy, which includes Compass
  4. Asset Management, which includes Salus Capital Partners, Five Island Asset Management, Energy & Infrastructure Capital (or EIC), and CorAmerica

Harbinger’s principal holdings include the following:

  • Spectrum Brands. Provides global branded consumer products in seven major product categories, including consumer batteries, small appliances, pet supplies, home and garden control products, electric shaving and grooming, electric personal care products, and hardware and home improvement
  • Fidelity & Guaranty Life (or FGL). Provides life insurance and annuity products
  • FrontStreet. Provides long-term reinsurance, including reinsurance to the specialty insurance sector of fixed, deferred, and payout annuities
  • HAMCO. Provides financing and engages in asset management across a range of industries
  • Compass. Engaged in the business of owning, operating, acquiring, exploiting, and developing conventional oil and natural gas assets
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Harbinger sees largest shareholder Leucadia raising stake

In November, Harbinger said Philip Falcone, its chief executive officer and chairman of the board, was resigning. Board member and Leucadia National (LUK) chairman Joseph Steinberg was made the board’s chairman.

Unconfirmed reports noted that Harbinger’s largest shareholder, Leucadia, acquired a further 5 million shares in the company after Falcone’s exit. It had earlier raised its stake in Harbinger Group Inc. to 20% and has two representatives on its board. Harbinger has seen speculations of being acquired by Leucadia.

4Q14 revenues impacted by decline in insurance segment revenue

Harbinger Group (HRG) posted total revenues of $6.0 billion for fiscal year 2014, up $419.6 million, or 7.6%, from the year ended September 30, 2013. The company said the increase was driven by growth in all operating segments.

Net loss narrowed to -$83.9 million, or $0.51 per common share, from -$94.2 million, or $0.67 per common share, in fiscal year 2013. Its fiscal 4Q14 revenues were up only 0.8% as it saw declines in its insurance segment revenues, driven primarily by lower investment gains and modestly lower energy revenues.

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