May 13, 2011 / 4:56 PM / 8 years ago

Harbinger Group raises funds from Fortress, others

* Harbinger Group is controlled by Philip Falcone

* Fortress has confidence in Harbinger strategy

* Harbinger to use funds for general purposes

BOSTON, May 13 (Reuters) - Philip Falcone’s Harbinger Group Inc HRG.N said it sold preferred shares worth $280 million to buyers including an affiliate of Fortress Investment Group LLC FIG.N, forging a closer relationship between two well known hedge fund organizations.

Harbinger Group, a holding company that owns life insurance and consumer products, is controlled by Falcone and his $6 billion Harbinger Capital Partners.

Falcone is chairman and chief executive of Harbinger Group. Before the preferred stock sales, disclosed by the group in a securities filing on Friday, Falcone’s hedge fund and related entities owned more than 90 percent of the group’s outstanding shares.

Fortress was one of the first big hedge fund firms to go public, still the exception in an industry that prefers to keep most financial details confidential.

A spokesman for Fortress, Gordon Runte, declined to discuss the purchase of Harbinger Group preferred stock in detail but said, “We are excited about this investment and have confidence in the go-forward strategy that HRG has laid out.”

In addition to Fortress, other buyers of the stock included Providence TMT Debt Opportunity Fund II LP, PECM Strategic Funding LP and Wilton Re Holdings Ltd.

Proceeds will be used for “general corporate purposes,” Harbinger Group said in its filing.

Falcone has not been clear on his plans for Harbinger Group but has been using it as an investment roll-up. Recently, the group acquired life insurance assets from Old Mutual for $350 million. (Reporting by Ross Kerber; editing by John Wallace)

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