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Citigroup can’t recoup $500M paid to Revlon lenders: judge

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Citigroup can't recoup $500M paid to Revlon lenders: judge

A federal judge on Tuesday said Citigroup cannot recoup half a billion dollars of its own money that it mistakenly wired lenders of cosmetics maker Revlon.

US District Judge Jesse Furman in Manhattan said the Aug. 11, 2020, wire transfers at issue were “final and complete transactions, not subject to revocation.”

The case stemmed from an incident where Citigroup, acting as Revlon’s loan agent, wired $893 million to Revlon’s lenders, appearing to pay off a loan not due until 2023.

Citigroup had intended to send a $7.8 million interest payment, and blamed human error for the gaffe.

Some lenders returned money they were sent, but 10 asset managers including Brigade Capital Management, HPS Investment Partners and Symphony Asset Management refused, prompting Citigroup’s lawsuit to recoup the estimated $501 million they received.

Citigroup had argued that the lenders should return the money because they knew or should have known it made a mistake, and that Revlon could not afford the payment.

But in a 101-page decision, following a six-day trial in December, Furman noted that the transfers matched “to the penny” what the lenders were owed, and said it appeared there had never been a mistake of this size before.

“The non-returning lenders believed, and were justified in believing, that the payments were intentional,” Furman wrote. “To believe otherwise — to believe that Citibank, one of the most sophisticated financial institutions in the world, had made a mistake that had never happened before, to the tune of nearly $1 billion — would have been borderline irrational.”

Citigroup had no immediate comment. Lawyers for the bank and for the asset managers did not immediately respond to requests for comment.

Administrative agents typically distribute interest payments and perform back-office services for clients such as Revlon.

Industry groups have said a ruling against Citigroup could expose banks to excessive liability risks.

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Michaels to be acquired by Apollo for $3.3 billion

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Michaels to be acquired by Apollo for $3.3 billion

Arts-and-crafts retailer Michaels said it has agreed to be acquired by private equity giant Apollo Global Management in a deal that values the company at $3.3 billion.

The going-private transaction values Michaels’ outstanding stock at $22 a share, a 47 percent premium to the closing price on Feb. 26, the last trading day before the media reported that Michaels was in play, the companies said.

The deal with Apollo — controlled by billionaire Leon Black, who has been weathering a scandal over his ties to dead pedophile Jeffrey Epstein — is valued at a total of $5 billion including debt.

Michaels shares on Wednesday rose $4.08, or 23 percent, to $22.10 in early trading.

The arts-and-crafts retailer has more than 1,200 stores in North America and it had been a go-to stop for consumers looking for something to do during quarantine.

In the fourth quarter, its comparable sales increased by 16.3 percent compared to a year ago.

“Our Michaels strategy and the work that we have done in the past year have led to phenomenal business results, strengthened our core business and positioned Michaels for long-term sustainable growth,” Michaels chief executive Ashley Buchanan said in a statement.

“As a private company, we will have financial flexibility to invest in, expand, and improve our retail and digital platforms.”

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Olbermann slammed for saying Texas shouldn’t get COVID vaccine

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Olbermann slammed for saying Texas shouldn't get COVID vaccine

Left-wing political pundit Keith Olbermann is drawing heat again, this time after he said that Texas shouldn’t get the COVID-19 vaccine.

In response to a tweet from Texas Gov. Greg Abbott who announced the end of the state’s mask mandate, Olbermann tweeted: “Why are we wasting vaccinations on Texas if Texas has decided to join the side of the virus?”

The tweet sparked a pile on across the Twittersphere with people from both sides of the aisle chastising the former ESPN and MSNBC talking head.

“Ah yes millions should be left to suffer and die because their Governor (who they are already trying to oust) is a festering pile of feces…or…or hear me out…we could support the communities he plans to sacrifice,” tweeted writer Mikki Kendall.

“I just think it’s wrong to make gross generalizations about the lives and potential deaths of an entire population. It is mean-spirited and unhelpful on every front,” wrote a Dallas Morning News reporter, Evan Grant.

Brandon Friedman, a former Obama administration official kept it short, writing: “Delete this, Keith,” while Daily Beast editor-at-large Molly Jong-Fast tweeted: “People deserve to stay safe and healthy no matter who they voted for.”

This isn’t the first — and likely won’t be the last — time the bombastic Olbermann has been in hot water after voicing his opinions.

Last November, he was slammed on Twitter for calling President Trump “a whiny little Kunta Kinte,” in a ham-fisted attempt to twist the name of the “Roots” character into a crude insult.

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Magic Johnson joins board of Fanatics

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Magic Johnson joins board of Fanatics

Basketball legend Earvin “Magic” Johnson joined the board of Fanatics, the sports licensing company said Wednesday.

The former Los Angeles Laker — who led his team five times to the NBA championship — has agreed to join the board as one of three independent directors, including Mindy Grossman, chief executive of WW (formerly Weight Watchers) and Gerald Storch, a former CEO of Toys R Us and Hudson’s Bay Company, which owns Saks Fifth Avenue.

The high-profile appointment comes as the privately held Fanatics, which makes jerseys and other gear for professional sports leagues and teams as well as universities, has been reportedly working toward plans to file for an initial public offering.

While an IPO is clearly an available path to us, there is no update on any timeline,” the company said in a statement. “Our focus remains on building a great global company and strengthening our vertical commerce business model.”

Led by founder Michael Rubin, Fanatics has been on a fundraising tear, securing $350 million in August, which values the company at $6.2 billion. The National Football League and Major League Baseball are also investors in the company, which sells licensed apparel mostly online.

In a statement, Rubin said of Johnson, “He’s an NBA legend and a titan in the business world, but more importantly he recognizes and leverages his platform to advance diversity and inclusion across all business sectors.”

The hoopster heads up Magic Johnson Enterprises, an investment company that focuses on ethnically diverse and underserved urban communities. In 2012, he became co-owner of the Los Angeles Dodgers and holds ownership stakes in the WNBA’s Los Angeles Sparks, Major League Soccer’s Los Angeles Football Club, and eSports franchise Team Liquid. His company also owned more than 100 Starbucks stores until 2010.

“It’s an honor to be invited to join the Fanatics board of directors,” Johnson said in a statement. “I’ve been impressed with the evolution of the company and its ability to transform the industry over the past several years.”

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