Carl Icahn sues Philip Falcones Spectrum Brands Inc?

I just wanted to point out Carl Icahn’s relationship to Harbinger Group Inc as I personally have found have been intrigued by the relationship between the two.  For example Icahn’s purchase of 300 million worth of Debt in Falcones LightSquared, as well as a rumor Icahn brewed himself in that he was going to buy Falcone out of his Ferrous Resources stake.

 I found a lawsuit where Areh(Ray) LLC is suing Spectrum Brands Inc           

Areh(Ray) LLC vs. Spectrum Brands Inc

 Dane County Case Number 2012CV002813

Laundering Securities: Harbinger, Spectrum Brands, Tong Lung Metal Industry Co. Ltd, and Stanley Black and Decker

Harbinger Group Inc is nothing but a special purpose vehicle constructed for the purpose of dumping illiquid, unwanted securities held by Falcone which he manipulated higher via complex share schemes, Enron style accounting, and things like payments to Fitch Ratings..  I believe it goes one step further however, and acquisitions such as the Stanley Black and Decker, are actually intended to acquire real and synthetic exposure to certain asset classes for which certain hedge funds are looking to short. 

This is how it was done in 2007 I've come to learn in my research, and I see the exact same thing happening now.  Same lines of business, same corporate structures, same types of mergers and joint ventures, and same corporate emphasis on expanding the balance sheet with debt and equity with no regard for long term survive. The behavior of insiders, patterns in share prices, and the same public misinterpreting the actions of certain hedge funds and their 13F-HR just as we saw 5 years ago.

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Pay to Play with Fitch Ratings and Harbinger Group Inc.

The ratings analysts over at Fitch must be sniffing glue or on the take, or both.  I don’t see any other plausible explanation for their failure to downgrade this disaster.

What I’d like to do is highlight events, pending litigation, and contingent factors which have been incurred over the last 12 months while Fitch has affirmed its B rating..  When you consider these points together, a credit downgrade seems way overdue.  

From November 2011 until now, Fitch has held Harbinger Group Inc rating at ‘B’.  

If Harbinger Group Inc goes, Spectrum Brands goes

I wanted to point out a couple technicals I’m watching on Spectrum Brands, a company I have written about on this blog in regards to major accounting and business concerns.

We have seen 6 months of higher lows so, watch last months low of 42.75.  What I really is if we break 42.75, hold 40.00, then rally back over 43 for a few days...then the next time we take out that low could be a good time to add some shorts.

Donald Shekels

Analyst for Hire

Philip Falcone’s Private Funds Corporate Structure.

If you thought the light squared structure was complicated, take a look at the structure of his private fund.

Accounting Games: Spectrum Brands and Harbinger Group Inc.

It’s the same game as it was back in 2005-2008 with Falcone and the related parties in Spectrum Brands.  I went back in the fillings and charted the revenue overlayed with net income for the 2nd chart, and the 1st chart is Goodwill and Intangibles.

I’ve written in previous entities about some of the ridiculous accounting gimmicks this concern uses to inflate revenue figures (capital expenditures).  Anyways what I want to display graphically is how it played out back in 2006, 2007, and 2008 where they started writing down the Goodwill and Intangibles they had been tacking on in years prior, then how the game was up in feb 2009 when they filled for bankruptcy and wiped out equity holders.

 Here is a chart I found of the bond ratings I thought was interesting to look at with the previous two.

The mergers and acquisitions I mentioned above which resulted in bogus accounting fluff (but not before insiders sold millions in stock), I figured i'd present a couple of the timelines here.