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For the most part, investors who have dared to bet on a turnaround of Citigroup Inc. have made some tidy profits over the past year or so.
The latest example is the Kuwait Investment Authority – a sovereign wealth fund — that made a $1.1billion profit by selling its stake in Citigroup on Sunday.
KIA invested $3 billion in Citigroup in 2008, as the Wall Street lender was reeling from subprime losses. Over the weekend, the KIA converted its preferred shares into common shares and sold them for a profit.
Here's a look at other large investments in Citigroup:
Government of Singapore Investment Corp. earned a $1.6 billion profit on its Citigroup investment in September. The Singapore government fund exchanged $6.88 billion of convertible preferred stock for Citigroup common shares at $3.25 apiece on Sept. 11.
Singapore closed this deal in January 2008, which also included a $3 billion investment from former Citigroup CEO Sandy Weill, the State of New Jersey and Saudi Prince Alwaleed Bin Talal. With Citigroup trading this morning at $4.09, these investors are likely to earn a profit, if they sell their shares.
The U.S taxpayers, who own 34% of Citigroup common shares, are on track for a big profit. The government converted its preferred shares into common stock at $3.25 a share – at the same price as Singapore conversion. That means the government’s 7.7 billion shares have gained about $3 billion.
Abu Dhabi Investment Authority didn't fare nearly as well. The Emerite pumped $7.5 billion into Citigroup in 2007, when the bank first began reeling from the credit crisis. Now, Abu Dhabi will soon start purchasing $7.5 billion of Citi shares, but at $31.83 a piece, or about eight times the current market value
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This guy Turbo Tax Timmy is a bigger US Tax Payer Cheat than I 1st thought he was! Check this out… hold on I’m a’coming to Citi-recoup your losses! http://www.bloomberg.com/apps/news?pid=20601068&sid=arrSAQ9kjwhA
Memo From: The US Tax Payer TO: Uncle Ben and Turbo Tax Timmy Seeing how we own 34% of nothing, does that mean we get a lump of coal for Christmas for being stupid.
Deal Journal is an up-to-the-minute take on the deals and deal makers that shape the landscape of Wall Street, including mergers and acquisitions, capital-raising, private equity and bankruptcy. In short, wherever money changes hands. Deal Journal is updated throughout each trading day with exclusive commentary, analysis, data, news flashes and profiles. The Wall Street Journal's Michael Corkery is the lead writer, with contributions from other Journal reporters and editors. Send news items, comments and questions to deals@wsj.com.
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