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Harbinger Has Potential $200 Million Loss on Navistar

Harbinger Capital Partners, the New York-based hedge-fund firm run by Philip Falcone, has almost $200 million in potential losses on bets that Navistar International Corp.’s stock price would rise.Harbinger bought swap contracts on 4.55 million shares of Navistar that would gain if the truck maker’s shares rose above certain prices, according to a Nov. 14 regulatory filing. Warrenville, Illinois-based Navistar has dropped 64 percent in New York trading this year to $19.40, about two-thirds below the price where the trades are profitable for Harbinger.

Falcone, 46, who oversees $20 billion in assets, lost about 18 percent so far in his flagship fund after being up about 42 percent in the first half of the year. The unrealized Navistar losses could be reversed if Navistar’s stock rebounds. That’s not likely any time soon, said Walter Liptak, an analyst at Barrington Research Associates in Chicago.

“With the truck market’s collapse and the trucker net income being what it is and finance being what it is, the outlook is pretty dreary,” Liptak said. Navistar is the world’s fourth-ranked truck maker and produces diesel engines for Ford Super Duty trucks.

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