LightSquared’s lenders says Philip Falcone’s Harbinger Capital Partners won’t hand over documents they are requesting as part of an investigation over whether they can pursue claims against Harbinger and the wireless satellite company. In a Tuesday filing with U.S. Bankruptcy Court in Manhattan, lawyers for a group of LightSquared lenders owed more than $1 billion said it “appears” LightSquared received “preferential” loans last summer without any investment by Harbinger, which owns most of LightSquared’s stock and has four of the company’s six board seats. The lender group says it has the right to subpoena Harbinger as part of its June agreement to allow LightSquared to use cash secured by its loans. But Harbinger, it says, has refused. “Harbinger’s basis for its blanket refusal is that ‘as these cases progress, it will become clear that sufficient value exists to pay all creditors in full under a Chapter 11 plan,’” said the lenders, whose loans are secured by all of LightSquared’s assets. [DowJones]
Wilbur
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Hedge Funds
LightSquared Creditors Will Get The Documents They Want, After They’ve Pried Them Out Of Phil Falcone’s Cold Dead Hands
By Bess Levin
Wilbur Falcone is a pig who can play the piano and lives with a hedge fund manager of the same name, who was dealt some bad news today. This is her story.
“Never wrestle with a pig. You both get dirty and the pig likes it.” — Unknown
Wilbur glanced down at her watch. 12:13. Usually, she hated when people were late and, under normal circumstances, this would have gone beyond the point of what she’d tolerate. Hell, make her wait more than 5 or 6 minutes and you were ensuring you’d be receiving a series of irate texts inquiring sharply as to “WHERE THE HELL ARE YOU??????!!???” and threatening “If you’re not here in 30 seconds I’m leaving.” But today she was practically willing Tom to continue making her wait under the bodega awning. Just another minute. Just one more minute.
She took a long drag off her cigarette. Almost immediately, Phil popped into her head, as he often did these days. “What are you doing,” he’d say, in a way that told you he was irritated but irritated because he cared. “That shit will kill you.” She’d let him convince her to give it up years back, citing evidence about what it would do to her singing voice, and hadn’t even ever used the emergency stash at the bottom of her vanity, even despite all that had gone down these last 18 months. But now she needed one. Just a few puffs and she could be transported, if only for a moment, from this nightmare. Read more »
For about a year now, hedge fund manager Phil Falcone’s relationship with his investors has been a bit rocky. While many expressed displeasure at his decision to tie up a good chunk of money in a wireless bet that may or may not pan out, what really set a lot of people off was Falcone’s decision, last November, to loan himself $113 million from a fund in which redemptions has been suspended, in order to pay personal taxes he hadn’t set aside enough cash to cover. Since then, Phil has not only paid the $113 million back, but 1) proved he learned his lesson re: borrowing money from humorless clients (in July he failed to pay $201,101 in property taxes, which he could have loaned himself from you know who but didn’t) and 2) offered investors interested in redeeming the opportunity to receive illiquid shares of his new company, or to sell their stakes on Craigslist. All of which is to say, he’s grown a lot in the last year. BlueLine fund investors, who were told in Harbinger’s most recent letter that their redemptions have been suspended, should keep that in mind. Read more »
As you know, Harbinger Capital currently has a big bet going on a wireless company called LightSquared. Should it succeed, Phil Falcone will make billions and his investors will receive the triple digit returns they scored on subprime. Should it fail…we don’t even want to go there but someone will need to take in the family’s award-winning singing and dancing pig, who’s made it clear he “doesn’t do” 2-bedroom rentals North of 86th Street. So far, unfortunately, LightSquared, illiquid shares of which were recently awarded to redemption-seeking investors, has encountered a few bumps in the road (as one often does when one is doing groundbreaking, visionary-esque work). Most recently the company has been making the case that its satellite system will be huge for “coordinating enforcement and emergency response teams during natural disasters, like Hurricane Katrina.” On the flip side, according to a new study by the FAA, it might kill a few hundred people. Read more »
As you know, Harbinger Capital currently has a big bet going on a wireless company called LightSquared. Should it succeed, Phil Falcone will make billions and his investors will receive the triple digit returns they scored on subprime. Should it fail…we don’t even want to go there but the victims will not be faceless and include but are certainly not limited to Lisa Falcone’s outfits (people in and of themselves) and the family’s cabaret performing pig. So far, unfortunately, LightSquared, illiquid shares of which were recently awarded to redemption-seeking investors, has encountered a few bumps in the road (as one often does when one is doing groundbreaking, visionary-esque work). Last month, it was reported that government tests indicated the company would not only cause “devastating interference” to all GPS devices in range but, according to the National Space-Based Positioning, Navigation and Timing Systems Engineering Forum, would “degrade global-positioning system navigation devices that are nearby and as far away as outer space.” LightSquared responded by promising “a workable solution for the small number” of GPS devices “that may be at risk,” but now it seems the venture has bigger problems than Mars on its hands– the boating community, which is pissed. Read more »
Earlier this morning, LightSquared, the big wireless bet currently being waged by Phil Falcone, made the exciting announcement that the venture has raised an additional $265 million in funding from investors old and new. While the news is heartening and brings the total amount secured $2.3 billion in the past year, LightSquared and Phil are still quite far from their goal. Read more »
The 6 months or so have not been the best of times for hedge fund manager Phil Falcone. The returns in Harbinger’s flagship have not exactly mimicked the highs of 2007, investors got their panties in a bunch when he borrowed $113 million from one of his funds (where redemptions had been frozen) in order to pay personal taxes, he had to put up his art collection as collateral to borrow even more cash, the deal that could make or break him has run into some bumps that include fucking things up in outer space and the same ingrates who gave him shit for locking up their money are getting all pissy because instead of giving them back actual cash, they’re getting illiquid shares of LightSquared. What’s more, construction on his Hampton’s home is still months and months away from being completed and it was looking like Phil was going to have to break the bad news to the Wilbur, the Falcone’s singing and dancing pig, that there’d be no getting wild at the Pink Elephant this summer. Already Wilbur had been dropping some not so subtle hints that most pigs of his talent wouldn’t have stuck around this long and that he had “options,” so it was a conversation Phil was not looking forward to. And then, out of nowhere, luck came a knocking on Phil’s front door. Read more »
Harbinger Capital-Backed LightSquared Says It Has Come Up With A Solution That Might Work Re: “Devastating Interference”
By Bess LevinSeveral weeks ago, it was reported that government tests indicated LightSquared, Phil Falcone’s big bet in the sky, would cause “devastating interference” to all GPS devices in range. Then last Thursday, the National Space-Based Positioning, Navigation and Timing Systems Engineering Forum said the venture would “degrade global-positioning system navigation devices that are nearby and as far away as outer space.” LightSquared, shares of which Harbinger Capital investors will receive should they have requested their cash back from the fund, says do not worry, though, because they’ve got a plan. Read more »
If This LiqhtSquared Bet Goes According To Plan, Phil And Lisa Maria Falcone Will Be Able To Buy A Whole House Of Dancing Pigs- And Ones For Their Haters, Too
By Bess Levin
For the latest issue of Vanity Fair, reporter Bethany McLean got personal with one of our favorite hedge fund couples, Phil and Lisa Maria Falcone. If you’ve been keeping up with the travails of the Harbinger Capital founder and his wife, you know that despite living in a 25,725-square foot mansion on 5th Avenue (which was renovated to include a bar inside Lisa’s closet), a few billion or so in the bank, unparalleled eyes for fashion and Manhattan’s premier singing and dancing pig who can also play the piano, the last couple years have not been the easiest for the Falcones. Everywhere they turn they feel like people are beating up on them, taking shots. To their chagrin and bewilderment, New York “society,” for the most part, doesn’t accept Lisa and many of Phil’s investors, when they’re not being held by a gate, have run for the hills, causing Harbinger’s assets under management to drop from a peak of $26 billion to $7 billion and counting. Things have gotten so bad, in fact that, several months back, Falcone “almost took off the Ganesh charm- the elephant-headed Hindu deity that represents good fortune- that he wears around his neck.” As he told McLean, “I thought, You have got to be kidding. I get very superstitious.”
But he kept it on and why? Because 1) You have not seen the best of Phil Falcone yet:
“You take your lumps and get your bruises. you get knocked down. The key is getting back up,” Falcone says. “I’m already standing. I’m 48. It’s not even the second period of my career, and I’ve had a pretty good first period.”
And 2) Phil’s got a big bet in the works, one that he’s pretty sure will shut everyone up, about everything, if the elephant can pull through for him. You know the one. LIGHTSQUARED. Yeah. Just let it sizzle there, in the air. It’s going to be huge and then all you people are going to be begging to invest with the best.
“I think [the wireless bet] could be bigger than subprime for me,” he says.
You know what else it will rival? Hairbrushes. Read more »
Headed To Vegas Next Week? If You Like Your Planes To Be GPS-Enabled, Consider Changing Plans
By Bess LevinProbably no big deal, but if you’re a nervous flyer, please note that Phil Falcone’s LightSquared will be running some tests that might interfere with the technology on aircrafts flying near Vegas. Read more »
Almost exactly a year ago, if you happened to be walking down East 67th Street toward Fifth Avenue, you probably stopped to peer through the window of a certain $49 million townhouse. Specifically the one belonging to Phil Falcone. There, a piano playing pig name Wilbur was pulling out all the stops (“Memory” from Cats, his infamous Bette Midler), in celebration of his boss making AR Magazine‘s annual list of the 25 highest paid managers, having taken home $825 million in 2009. The good spirits and the gin were running high that night and the party didn’t stop ’til the early hours of the morning. This year, things will be different. The lights will be dimmed and Wilbur will be in his room, digging out the cocktail napkin with the number of the hedge fund manager he’d met last summer in Connecticut. He told himself he wasn’t going to do anything with it but…things have changed. Read more »
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