A federal investigation into Guggenheim Partners co-founder Mark Walter is focusing on four intermediaries involved in loans from his insurance companies to other businesses within his empire. This comes after Bloomberg reported earlier that federal authorities were scrutinizing related-party transactions at Guggenheim, specifically focusing on loans issued by insurance subsidiaries to other Walter-affiliated businesses.
This investigation aligns with previous reports from Bloomberg that highlighted federal authorities' scrutiny of related-party transactions at Guggenheim, particularly regarding loans from insurance subsidiaries to other Walter-affiliated entities. The ongoing federal probe raises questions about the financial practices within Walter's extensive business network.
Separately, Graphic Packaging International (GPI) is facing its second securities lawsuit this year. The new lawsuit, filed by shareholder James Wheeler, alleges that misconduct by GPI leadership, including current CEO Robbert Rietbroek, former CEO Mike Doss, former CFO Stephen Scherger, and the board members, led to securities law violations and breaches of fiduciary duty. The lawsuit claims that executives failed to oversee inventory management and misled the public about financial health and reasons for high inventory levels amidst deteriorating customer demand. The lawsuit also cites the May 2025 earnings release where GPI revised down its full-year guidance, leading to a 15% stock drop. The new complaint highlights costs for the Waco mill being 67% above the original $1 billion estimate, contributing to a cumulative stock decline of over 50% from pre-May 2025 levels. It also accuses former board chair Philip Martens of insider trading in 2025. GPI has stated it intends to "vigorously defend against the claims."
In its Q2 2026 earnings call, GPI reported net sales of $2.19 billion, down 0.7% year-over-year, and net income of $24 million, significantly lower than $104 million in Q2 2025. Despite a challenging consumer environment, the company aims for $85 million in 2026 cost savings, up from a previous expectation of $60 million. Inflation is now expected to add at least $150 million in costs for the year, up from $60-$65 million. GPI lowered its full-year guidance, now expecting net sales at the high end of $8.4-$8.6 billion, adjusted EBITDA at the low end of $1.05-$1.25 billion, and free cash flow of $600-$700 million. Inventory reduction goals are being pushed into 2027, with inventory expected to be 18-19% of sales. The company plans facility closures in Lebanon, Tennessee, and potentially Winsford, UK, and recently re-entered the uncoated recycled paperboard market with its PaceSetter Ridgeline product. GPI also announced price increases for recycled paperboard, which are expected to bring an additional $200 million on an annualized basis if fully recognized.
