Business

Phil Falcone plans his return

After getting a taste of life in the hedge-fund big leagues, Harbinger Capital Management’s Phil Falcone is scrambling to return to his former glory.

Sources tell The Post that Falcone, whose assets now total roughly $9 billion compared to a high last year of $25 billion, has been aggressively rebuilding his troubled empire, raising new money, launching new funds and poaching talent from big-name hedge funds like Ken Griffin’s Citadel Investment Group.

According to people familiar with Harbinger, Falcone over the past few months has hired a new chief operating officer, Peter Jenson, from Citadel, and a director of investments, Omar Asali, from Goldman Sachs. Over the summer, he snagged Robin Roger of Duff Capital as chief counsel.

One potential investor said that hires like those are helping him get comfortable with investing in Harbinger.

So far, Falcone’s succeeded in raising several hundred million dollars this year despite an economy that has made it tough for some rivals to attract cash.

Falcone’s new distressed credit fund — called Blue Line, a reference to the offensive zone in hockey, a passion of his — is up 55 percent since its launch in April, and has attracted $500 million in investments.

A new private-equity fund, called Breakaway — another hockey term that refers to a player zoning in on a goalie — is up 56 percent since its launch, and has $250 million in assets.

Most important, he’s recouped losses in his flagship fund, which also suffered from a crackdown on investors’ redemptions last year. Overall, assets are well off their lows of around $6 billion.

Falcone was launched into sudden stardom in the first half of last year after making a mint on savvy bets against subprime mortgages, but Harbinger hit the skids following a number of investment missteps, most notably the high-profile but poorly timed investment in The New York Times Co.