Hedge Fund Trims Media General Stake More — Sending Stock Tumbling

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By: Mark Fitzgerald

When the share price of Media General Inc. stock started falling from the opening bell Friday, it first seemed as if investors were reacting to news from the night before that Philip Falcone?s hedge fund had trimmed its stake in the Tampa Tribune parent. After the closing bell, the fund, Harbinger Capital Partners Master Fund, disclosed in a regulatory filing that it was the investor doing most of the selling.

In a Securities and Exchange Commission (SEC) filing, Harbinger said that for the second consecutive day it had reduced its holdings of Media General stock to 2,535,314 shares, or 11.41% of shares outstanding. In an SEC filing Thursday, Harbinger disclosed it had pared its stake to 16.67% from more than 18%.

Harbinger, an activist fund that also has representatives on The New York Times Co.?s board of directors, amassed the stock earlier this year for a successful proxy fight to seat three representatives on Media General?s board. Media General shares in the winter, when Harbinger was acquiring the stock, sold in a range of about $15 to $18 a share.

Media General Inc. (NYSE: MEG) ended the day at $1.39, dropping 87 cents — a plunge of 37.67%. Harbinger?s activity could be seen from the enormous volume. On a normal trading session, about 282,000 shares of Media General change hands. On Friday, the volume was 2.23 million shares.

There?s more on Media General at E&P?s business-oriented blog Fitz & Jen blog.

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