Citigroup to sell $7.5 billion stake to Abu Dhabi

[hapimom98]

I couldn't find a post on this, if there is, my apologies.

This doesn't look good to me. I know nothing about this kind of stuff, but it just doesn't look good. Can anyone shed any layman's-light on this?

NEW YORK/DUBAI (Reuters) - Citigroup Inc (NYSE:C - News) is selling up to 4.9 percent of itself for $7.5 billion to the Gulf Arab emirate of Abu Dhabi, giving the largest U.S. bank fresh capital as it wrestles with the subprime mortgage crisis and the resignation of its chief executive.

.....more at link:
http://biz.yahoo.com/rb/071127/citi_abudhabi.html?.v=24

[Old 33]

I couldn't find a post on this, if there is, my apologies.

This doesn't look good to me. I know nothing about this kind of stuff, but it just doesn't look good. Can anyone shed any layman's-light on this?
Citigroup didn't have enough cash reserves to meet its obligations, and was in danger of being split up or liquidated.

They got a huge infusion of cash from the Middle East, which will keep Citigroup afloat. And the source of the cash will have a significant stake in Citigroup going forward.

[Brick]

I couldn't find a post on this, if there is, my apologies.

This doesn't look good to me. I know nothing about this kind of stuff, but it just doesn't look good. Can anyone shed any layman's-light on this?

NEW YORK/DUBAI (Reuters) - Citigroup Inc (NYSE:C - News) is selling up to 4.9 percent of itself for $7.5 billion to the Gulf Arab emirate of Abu Dhabi, giving the largest U.S. bank fresh capital as it wrestles with the subprime mortgage crisis and the resignation of its chief executive.

.....more at link:
http://biz.yahoo.com/rb/071127/citi_abudhabi.html?.v=24

I wonder if he gets his "golden parachute" as he leaves. Probably.

Sometimes I see CEO's like modern day pirates. The run the ship however they want then take a nice bit of booty with them when they leave.

[spbluebird]

This doesn't look good to me. I know nothing about this kind of stuff, but it just doesn't look good. Can anyone shed any layman's-light on this?

I'm wondering the exact same thing. Maybe someone here with more economics knowledge can help us understand what this entails... :scratch

[jds6958]

imho this is just a pig with lipstick scenario...if the math is done they basically sold about 7.5 billion $ of shares at a 25% discount...good thing the shareholders are usually slow on math and will just falsely interpret this as stability

they are paying 11% a year on this...woooo, sounds a little desperate to me, almost like a last ditch effort...makes ya think, if C goes down the last of the remaining optimists will also agree that the tides have turned...this might soar in the short term...but it looks like a CFC in the making....C just maybe bought some time if the market buys this in the short term...but they just put the nail in the coffin imho demonstrating that they are just a house of cards...

if you have an account with them, consider pulling it imho...this is the opportunity...

this is just all my opinion at first glance, so other thoughts are very welcomed...

[topekaclark]

I was reading or watching a news show stating, American corporations are selling to oversees investors. That the money is to good to pass up. It's a worrisome trend and wonder what that will mean for us as the consumers and our country as well?

I wish I could drop them but I can't afford to, yet.

[Look4Truth]

imho this is just a pig with lipstick scenario...if the math is done they basically sold about 7.5 billion $ of shares at a 25% discount...good thing the shareholders are usually slow on math and will just falsely interpret this as stability

they are paying 11% a year on this...woooo, sounds a little desperate to me, almost like a last ditch effort...makes ya think, if C goes down the last of the remaining optimists will also agree that the tides have turned...this might soar in the short term...but it looks like a CFC in the making....C just maybe bought some time if the market buys this in the short term...but they just put the nail in the coffin imho demonstrating that they are just a house of cards...

if you have an account with them, consider pulling it imho...this is the opportunity...

this is just all my opinion at first glance, so other thoughts are very welcomed...

Agreed. The government is just going to consolidate everything eventually anyway, just like in the 30's.

[NewWorldOrder]

I saw this on Drudge this morning, and it doesn't make sense to me. Citigroup, just bought our mortgage. In fact they bought all the mortgages that were being held by our old mortgage company, and now this. I don't understand how you can have the money buy up all those mortgages, and then need to be bailed out like that. What really gets to me, is that they made this deal with an Arab company. It's not enough that they own us because of their oil, now they own us because of our mortgages. :doh I'm really disgusted by it. I'd really like to just pay off the dumb mortgage, but I can't

[C. Little]

I saw this on Drudge this morning, and it doesn't make sense to me. Citigroup, just bought our mortgage. In fact they bought all the mortgages that were being held by our old mortgage company, and now this. I don't understand how you can have the money buy up all those mortgages, and then need to be bailed out like that. What really gets to me, is that they made this deal with an Arab company. It's not enough that they own us because of their oil, now they own us because of our mortgages. :doh I'm really disgusted by it. I'd really like to just pay off the dumb mortgage, but I can't

You can't because you're paying so much for oil!