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56-642: HRG Group, Inc. , formerly Harbinger Group Inc. and Zapata Corporation , was a holding company based in Rochester, New York , having originated from an oil company started by a group including future U.S. president George H. W. Bush . In 2009, it was renamed the Harbinger Group Inc. The company traced its origins to Zapata Petroleum Corporation, founded in 1953 by future U.S. President George H. W. Bush , along with his business partners John Overbey, Hugh Liedtke , Bill Liedtke , and Thomas J. Devine. Overbey

112-559: A 41% share of Amata Gas Corporation. In 1964, Bush ran for the United States Senate , and lost; he continued as president of Zapata Off-Shore until 1966, when he sold his interest to Doyle Mize and ran for the U.S. House of Representatives . On September 9, 1965, Hurricane Betsy struck the coast of Louisiana sinking the oil rig Maverick . There were no deaths, however, $ 8 million in Zapata assets were lost. A helicopter flew Bush over

168-454: A CIA staffer who had resigned his agency position that same year to go into private business, but who continued to work for the CIA under commercial cover. Devine would later accompany Bush to Vietnam in late 1967 as a "cleared and witting commercial asset" of the agency, acted as his informal foreign affairs advisor, and had a close relationship with him through 1975. In 1954, Zapata Off-Shore Company

224-572: A day, and by 1918 had delivered over 85 million barrels of oil. In 1911 Doheny signed a contract to supply Standard Oil . Doheny's Mexican Petroleum Company made a major strike in February 1916 with the Cerro Azul No. 4 well in Cerro Azul, Veracruz , Mexico. When the well struck it shot a stream of oil 598 feet (182 m) into the air. It became world's largest, pumping 260,000 barrels per day. Over

280-695: A few years later the Mexican properties were nationalized. President Lázaro Cárdenas expropriated all foreign oil concessions on 18 March 1938 and placed them under the government-controlled Pemex , paying compensation to the former owners. In the 1940s the case of Blaustein v. Pan American Petroleum & Oil Transport Co. was heard by the Supreme Court to determine whether the directors of Pan American had been in breach of their fiduciary duty. The directors were all officers of directors of Standard Oil of Indiana, which held almost 80% of Pan American's shares, and it

336-659: A fleet of 31 tankers. The company paid $ 1.1 million in dividends in 1917 and $ 3.1 million in dividends on its common stock in 1918. 1918 revenues were $ 17 million and net profits were almost $ 7 million. In 1918 the Carib Syndicate , a concern owned by Americans, bought the Barco oil concession in Colombia. They sold 75% of their interest to the Colombian Petroleum Company the next year, a subsidiary of Pan American. Doheny

392-502: A loan and stock sale. But financier Malcolm Glazer , owner of the NFL franchise Tampa Bay Buccaneers and Premier League club Manchester United , and at the time owner of 40 percent of Zapata, did not want his holdings diluted and filed a lawsuit to block the deal. By 1994, the company had come under Glazer's control, after a proxy fight . Glazer became chairman of Zapata, replacing Ronald Lassiter, and in 1995 Avram Glazer , son of Malcolm,

448-573: A matter of broadcast regulation . In the United States, a personal holding company is defined in section 542 of the Internal Revenue Code . A corporation is a personal holding company if both of the following requirements are met: A parent company is a company that owns enough voting power in another firm (or subsidiary ) to control management and operations by influencing or electing its board of directors . The definition of

504-425: A parent company differs from jurisdiction to jurisdiction, with the definition normally being defined by way of laws dealing with companies in that jurisdiction. When an existing company establishes a new company and keeps majority shares with itself, and invites other companies to buy minority shares, it is called a parent company. A parent company could simply be a company that wholly owns another company, which

560-447: A previous offshore contract. The deal with Permargo is not mentioned in Zapata's annual reports, and SEC records are missing. In 1988, a Bush spokesman claimed that the deal lasted only from March to September 1960. However, Zapata sold the oil-drilling rig Nola I to Pemargo in 1964. Zapata's filing records with the U.S. Securities and Exchange Commission are intact for the years 1955–1959, and again from 1967 onwards. However, records for

616-597: A record analyst with the commission). During the Bay of Pigs invasion and the Cuban Missile Crisis , Zapata allowed its oil rigs to be used as listening posts . In 1988, Barron's said Zapata was "a part time purchasing front for the [ Central Intelligence Agency ]". In 1962, Bush was joined in Zapata Off-Shore by Robert Gow. By 1963, Zapata Off-Shore had four operational oil-drilling rigs—Scorpion (from 1956,

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672-465: A tending subsidiary of the purchasing company, which, in turn, becomes the parent company of the subsidiary. (A holding below 50% could be sufficient to give a parent company material influence if they are the largest individual shareholder or if they are placed in control of the running of the operation by non-operational shareholders.) In the United Kingdom, the term holding company is defined by

728-521: A year and limited its ability to refinance, which proved to be a key obstacle leading to that firm's February 2015 Chapter 11 bankruptcy as the chain was forced to keep more than a thousand unprofitable stores open. Fidelity & Guaranty Life , the insurer backed by Harbinger Group, also has a $ 50 million stake in the RadioShack bankruptcy. An impairment of $ 105.0, out of the $ 150 million net exposure, recognized as of March 31, 2015. On February 26, 2018,

784-458: Is defined by Part 1.2, Division 6, Section 46 of the Corporations Act 2001 (Cth) , which states: A body corporate (in this section called the first body) is a subsidiary of another body corporate if, and only if: Toronto-based lawyer Michael Finley has stated, "The emerging trend that has seen international plaintiffs permitted to proceed with claims against Canadian parent companies for

840-806: Is probably best remembered for Zapata's unsolicited (and unsuccessful) takeover bid of the Excite internet portal. During this period, Zapata also built up a controlling stake in Safety Components International, a manufacturer of air bag fabrics and cushions. On December 2, 2005, Zapata Corporation Chairman, Avram ("Avi") Glazer , announced the sale of 4,162,394 shares, 77.3%, of Safety Components International to Wilbur L. Ross Jr. for $ 51.2 million. The company sold its remaining stock in Omega Proteine on December 1, 2006, leaving it with no active subsidiary. The Glazer family sold its controlling stock of

896-453: Is sometimes done on a per- market basis. For example, in Atlanta both WNNX and later WWWQ are licensed to "WNNX LiCo, Inc." (LiCo meaning "license company"), both owned by Susquehanna Radio (which was later sold to Cumulus Media ). In determining caps to prevent excessive concentration of media ownership , all of these are attributed to the parent company, as are leased stations , as

952-626: Is then known as a " wholly owned subsidiary ". Pan American Petroleum Edward L. Doheny was a prospector who became wealthy in the 1880s from silver mines in the Black Range of New Mexico. In 1892 he moved with his family to Los Angeles , where he sank a mine and found oil at the corner of Patton Street and West State Street. This began an oil boom in Los Angeles. Doheny overextended himself and his company went bankrupt in August 1896. The setback

1008-428: Is to own stock of other companies to form a corporate group . In some jurisdictions around the world, holding companies are called parent companies , which, besides holding stock in other companies, can conduct trade and other business activities themselves. Holding companies reduce risk for the shareholders , and can permit the ownership and control of a number of different companies. The New York Times uses

1064-473: The Companies Act 2006 at section 1159. It defines a holding company as a company that holds a majority of the voting rights in another company, or is a member of another company and has the right to appoint or remove a majority of its board of directors, or is a member of another company and controls alone, pursuant to an agreement with other members, a majority of the voting rights in that company. After

1120-1464: The Near East Development Corporation , the Anglo-Persian Oil Company , Royal Dutch Shell , and the Compagnie Française des Pétroles each 23.75% of any oil that was produced by the Turkish Petroleum Company. The Near East Development Corporation (NEDC) represented American interests and included Jersey Standard Oil, Socony-Vacuum Oil Company, Gulf Oil, the Pan-American Petroleum and Transport Company, and Atlantic Refining. The remaining 5% share went to an Armenian businessman, Calouste Gulbenkian , who had previously owned shares within TPC. Pan American sold out its shares in NEDC to Jersey Standard and Socony (later Mobil ) in 1930. In 1932 Pan American sold its foreign properties to Standard Oil of New Jersey for about $ 100 million. With this acquisition, Standard Oil of New Jersey became Mexico's largest oil producer. The deal also included large oil concessions in Venezuela and Pan-American's UK subsidiary Cleveland Petroleum Products. However,

1176-613: The financial crisis of 2007–2008 , many U.S. investment banks converted to holding companies. According to the Federal Financial Institutions Examination Council 's website, JPMorgan Chase , Bank of America , Citigroup , Wells Fargo , and Goldman Sachs were the five largest bank holding companies in the finance sector, as of December 2013 , based on total assets. The Public Utility Holding Company Act of 1935 caused many energy companies to divest their subsidiary businesses. Between 1938 and 1958

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1232-461: The seven largest U.S. oil producers included wells 40 miles (64 km) north of Isabela , Cuba, near the island Cay Sal . In 1959 Bush bought control of Zapata Off-Shore, funded with $ 800,000, splitting Zapata Corporation into two independent companies with the Liedtkes still in control of Zapata Petroleum. Bush moved his offices and family that year from Midland, Texas to Houston for access to

1288-453: The "zap.com" name. In July 1998, Zapata announced its plans to acquire several web sites, including ChatPlanet, TravelPage and DailyStocks.com. The company's stock boomed and crashed along with other dot-coms , and on January 24, 2001 the company conducted a 1 for 10 reverse stock split . The venture was cited by many investment journalists as an example of a company jumping on the internet bandwagon without any relevant experience. This period

1344-560: The 1970s, under chairman and CEO William Flynn, Zapata expanded its business to include subsidiaries in dredging, construction, coal mining, copper mining and fishing. By the late 1970s, saddled with weak operations, high debt and low return on investment, the company again began undergoing changes in management and direction. Led by John Mackin, who succeeded William Flynn, the company began selling off some of those businesses and refocused on offshore oil and gas exploration and production. In 1982, chief operating officer Ronald Lassiter assumed

1400-692: The California assets of Pan American Petroleum and Transport were transferred to a new holding company, the Pan American Western Petroleum Company, in which Doheny retained control. He sold a majority of shares in the remainder of the Venezuelan facilities of the Pan American Petroleum and Transport Company and his Mexican Petroleum Company to Pan American Eastern Petroleum, a new subsidiary of Standard Oil of Indiana . This included

1456-705: The Caribbean through the Houston Ship Channel. But although Zapata Offshore had only a few drilling rigs, Bush set up operations also in the Gulf of Mexico, the Persian Gulf, Trinidad, Borneo, and Medellín, Colombia, and the Kuwait Shell Petroleum Development Company was among the company's clients. In 1960, Jorge Díaz Serrano of Mexico was put in touch with Bush by Dresser Industries . Dresser

1512-402: The Mexican holdings, Atlantic and Gulf Coasts holdings in the United States, refineries, pipelines and 31 tankers. At the end of 1925 Pan American Western gained control of Lago Petroleum Corporation from C. Ledyard Blair 's Blair & Co.. The transaction was to be the subject of a stockholder action in 1933, alleging that there had been a conspiracy by the bankers, who were represented on

1568-543: The Pan American board, to make excessive profits. In 1926 Venezuelan Eastern Petroleum Corporation was organized as a subsidiary of Pan American Eastern with the purpose of buying and developing Venezuelan oil properties. The Turkish Petroleum Company discovered a large oil field in Iraq in 1928. France, the United Kingdom, and the United States were each worried about being edged out by the other two. The Red Line Agreement gave

1624-520: The US Navy's petroleum reserves. Neither lease was subject to competitive bidding. In 1924 rumors about corruption in the deals escalated into the Teapot Dome scandal . On 24 January 1924 Doheny testified before the U.S. Senate Committee on Public Lands and Surveys, and admitted that he had loaned Fall $ 100,000 in cash with no security some months before the oilfield leasing arrangement was made. Doheny said

1680-455: The United Kingdom, is generally held that an organisation holding a 'controlling stake' in a company (a holding of over 51% of the stock) is in effect the de facto parent company of the firm, having overriding material influence over the held company's operations, even if no formal full takeover has been enacted. Once a full takeover or purchase is enacted, the held company is seen to have ceased to operate as an independent entity but to have become

1736-637: The United States for use in paving. He formed the Mexican Petroleum Company and funded it with $ 6 million of his own money. In 1905 he bought properties near Tuxpan, Veracruz , and formed the Huasteca Petroleum company to hold them. In 1910 his wells in the Juan Casiano Basin in the Faja de Oro field started to produce good quality oil. The gusher at Casiano number 7 spewed out 60,000 barrels

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1792-563: The Zapata Corporation to Philip Falcone's Harbinger Capital in 2009, and the company's name was changed to Harbinger Group Inc. with the ticker symbol HRG on the NYSE . In 2010–2011, Harbinger Capital Partners LLC transferred its 54.4% interest in Spectrum Brands to Harbinger Group Inc. giving the company controlling interest in that company. Also in 2011 Harbinger Group Inc. acquired

1848-492: The allegedly wrongful activity of their foreign subsidiaries means that the corporate veil is no longer a silver bullet to the heart of a plaintiff's case." The parent subsidiary company relationship is defined by Part 1, Section 5, Subsection 1 of the Companies Act, which states: 5.—(1) For the purposes of this Act, a corporation shall, subject to subsection (3), be deemed to be a subsidiary of another corporation, if — In

1904-500: The area for several days until debris was located. After evidence was submitted to Lloyd's of London for the loss, they paid Zapata for the claim. In 1966, William Stamps Farish III , age 28, joined the board of Zapata. Zapata sought to acquire a controlling interest in the United Fruit Company in 1969, but was outbid by Eli M. Black 's AMK Corp. Robert Gow's father, Ralph Gow, was on United Fruit's board of directors. In

1960-408: The company announced it was merging with Spectrum Brands , which it was a controlling shareholder of. The merger was completed on July 13. Official website Holding company A holding company is a company whose primary business is holding a controlling interest in the securities of other companies. A holding company usually does not produce goods or services itself. Its purpose

2016-529: The completed rig did not function, followed by an additional $ 550,000 together with 38,000 shares of Zapata Off-Shore common stock when it did. The U.S. government began to auction off mineral rights to the Caribbean, the Gulf of Mexico , and islands off the Central American coast in 1954, and in the late 1950s and early 1960, Zapata Off-Shore concentrated its business in these areas. In 1958, drilling contracts with

2072-501: The first oil-drilling jackup rig ever built), Vinegaroon (from 1957), Sidewinder, and (in the Persian Gulf ) Nola III. In 1963, Zapata Petroleum merged with South Penn Oil to become Pennzoil . By 1964, Zapata Off-Shore had a number of subsidiaries, including: Seacat-Zapata Offshore Company (Persian Gulf), Zapata de Mexico, Zapata International Corporation, Zapata Mining Corporation, Zavala Oil Company, Zapata Overseas Corporation, and

2128-408: The insurance company Old Mutual U.S. Life Holdings, Inc. from Old Mutual . In December 2013, Salus Capital (a unit of Harbinger Group) and Cerberus Capital Management issued a quarter-billion dollars in financing to struggling retailer RadioShack Corporation. Among the terms of this deal were restrictions which prevented RadioShack from closing more than 200 of its 4275 company-owned retail stores

2184-419: The loan was a personal one. Pan American had been the lowest bidder for a contract to build and fill crude oil storage facilities at Pearl Harbor , and had offered to undertake this contract in exchange for the oilfield lease, being paid in oil and then paying royalties to the government for oil extracted in excess of costs. Eventually the Supreme Court nullified both leases. It was not until 1930 that Doheny

2240-682: The next fourteen years the well produced over 57 million barrels. The Mexican Petroleum Company eventually acquired ownership or leasehold rights to 1,500,000 acres (610,000 ha) of land. The Pan American Petroleum and Transport Company was incorporated by Doheny in Delaware in 1916 as the holding company for his Mexican Petroleum Company , Huasteca Petroleum Company and California oil properties. World War I drove up demand for oil-fueled transport, and Doheny responded by expanding pumps, tanks and loading sites in Tampico. By July 1917 Pan American had

2296-571: The number of holding companies declined from 216 to 18. An energy law passed in 2005 removed the 1935 requirements, and has led to mergers and holding company formation among power marketing and power brokering companies. In US broadcasting , many major media conglomerates have purchased smaller broadcasters outright, but have not changed the broadcast licenses to reflect this, resulting in stations that are (for example) still licensed to Jacor and Citicasters , effectively making them such as subsidiary companies of their owner iHeartMedia . This

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2352-432: The oil drilling company proposed selling its entire fleet of offshore drilling rigs to focus solely on fishing. The company had not had a profitable quarter in more than five years. In 1990, Zapata Offshore sold 12 of its drilling rigs to Arethusa Offshore, which a few years later merged with Diamond Offshore . Still struggling with debt by 1993, Zapata signed a deal with Norex America to raise more than $ 100 million through

2408-517: The role of CEO, and presided over a decade of loss-making brought on by the collapse of oil prices. In 1982, Zapata Off-shore became Zapata Corporation. Its stock performed poorly. By 1986, Zapata was one of the bad loans that shook the foundations of San Francisco-based Bank of America , with a debt of more than $ 500 million and a fiscal year loss of $ 250 million. The company announced several restructurings during those years and managed to stave off bankruptcy, but continued to incur major losses. In 1990

2464-540: The stock of Company B, Company A will not pay taxes on dividends paid by Company B to its stockholders, as the payment of dividends from B to A is essentially transferring cash within a single enterprise. Any other shareholders of Company B will pay the usual taxes on dividends, as they are legitimate and ordinary dividends to these shareholders. Sometimes, a company intended to be a pure holding company identifies itself as such by adding "Holding" or "Holdings" to its name. The parent company–subsidiary company relationship

2520-511: The term parent holding company . Holding companies can be subsidiaries in a tiered structure . Holding companies are also created to hold assets such as intellectual property or trade secrets , that are protected from the operating company. That creates a smaller risk when it comes to litigation . In the United States, 80% of stock, in voting and value, must be owned before tax consolidation benefits such as tax-free dividends can be claimed. That is, if Company A owns 80% or more of

2576-486: The years 1960–1966 are missing. The commission's records officer stated that the records were inadvertently placed in a session file to be destroyed by a federal warehouse, and that a total of 1,000 boxes were pulped in this procedure. The destruction of records occurred either in October 1983 (according to the records officer), or in 1981 shortly after Bush became Vice President of the United States (according to, Wison Carpenter,

2632-439: Was a "landman" skilled in scouting oil fields and obtaining drilling rights cheaply. Bush and Thomas J. Devine were oil-wildcatting associates. Their joint activities culminated in the establishment of Zapata Oil. The company was named for Viva Zapata! , a 1952 biographical film starring Marlon Brando as Mexican revolutionary Emiliano Zapata . The initial $ 1 million (equivalent to $ 11,400,000 in 2023) investment for Zapata

2688-477: Was also interested in plans to develop the oil industry in Venezuela, and in building a pipeline from Colombia to Venezuela to make it more economical to export the Barco oil production from the west coast of Lake Maracaibo . In 1921 Pan American was the largest oil company in the United States, ahead of Sinclair Consolidated Oil Corporation and the Standard Oil Company of Indiana . Automobile production

2744-660: Was booming and oil prices were high. The Mexican Petroleum Company was the largest in Mexico, and Mexico was the largest oil producer in the world. In 1922 Albert B. Fall , U.S. Secretary of the Interior, leased the oil field at Elk Hills, California, to the Pan American Petroleum & Transport Company. Around the same time, the Teapot Dome Field in Wyoming was leased to Sinclair Consolidated Oil Corporation. Both oilfields were part of

2800-528: Was charged that they had deprived Pan American of profitable opportunities to drill and refine oil. The majority finding, setting an important precedent, was that it should be assumed that they had acted in good faith and without personal gains to themselves. In 1954 Pan American merged with Standard of Indiana to form the American Oil Company, Amoco . Amoco was in turn acquired by BP in 1998. The novel Oil! by Upton Sinclair published in 1927

2856-499: Was cleared of all charges. In 1923 Louis Blaustein and his son Jacob Blaustein sold a half interest in their American Oil Company to Pan American in exchange for a guaranteed supply of oil. Before this deal, American Oil had depended on Standard Oil of New Jersey , a competitor, for its supplies. At the end of 1923 Pan American had a net worth of $ 173 million, with net earnings that year of over $ 20 million. The company paid dividends of $ 20.4 million that year. On 1 April 1925

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2912-457: Was formed as a subsidiary of Zapata Oil, with Bush as president of the new company. He raised some startup money from Eugene Meyer , publisher of the Washington Post , and his son-in-law, Philip Graham . Zapata Off-Shore accepted an offer from an inventor, R. G. LeTourneau , for the development of a mobile but secure drilling rig. Zapata advanced him $ 400,000, which was to be refundable if

2968-436: Was named CEO and president of Zapata. De facto headquarters moved from Houston to Rochester, New York. It no longer engaged in exploration, but owned several natural gas service companies. It also produced protein products from the menhaden fish. In subsequent years Zapata sold its energy-related businesses and focused on marine protein. Between 1998 and 2000, Zapata tried to position itself as an internet media company under

3024-463: Was owned by Prescott Bush 's Yale friends Roland and W. Averell Harriman , and had been George H.W. Bush's first employer upon his graduation from Yale , giving him his start in both the oil business and the defense contractor business. Serrano and Bush created a new company, Perforaciones Marinas del Golfo, aka Permargo, in conjunction with Edwin Pauley of Pan American Petroleum , with whom Zapata had

3080-465: Was provided by the Liedtke brothers and their circle of investors, by Bush's father Prescott Bush and his maternal grandfather George Herbert Walker , and their family's circle of friends . Hugh Liedtke was named president, Bush was vice president; Overbey soon left. According to a CIA internal memo dated November 29, 1975, Zapata Petroleum began in 1953 through Bush's joint efforts with Thomas J. Devine,

3136-606: Was temporary, and a long-term contract with the Atchison, Topeka and Santa Fe Railway gave him the opportunity to develop and expand a growing number of oil properties. In 1900 he visited Mexico with his associate Charles A. Canfield and Almon Porter Maginnis of the Santa Fe railroad, saw the oil potential of the country near Tampico, Tamaulipas and began acquiring property. Doheny found heavy oil in El Ebano in 1901, which he exported to

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