Tuesday, 16 September 2014
Last updated 8 hours ago
Oct 8 2009 | 1:24am ET
Citigroup hopes to sell its highly-profitable proprietary commodities trading group, in part to avoid a backlash at a firm that received billions in government bailout money paying its head a promised $100 million bonus.
The financial services giant has kicked around several options for the group, known as Phibro, including a spin-off as an independent hedge fund. But Citi has settled on trying to sell the unit outright, a move which could net it several hundred million dollars, although it would also deprive it of a business line that’s earned about $2 billion over the past five years.
At issue is Citi’s contract with Andrew Hall, the head of Phibro. That deal guarantees Hall at $100 million bonus, a fact that has become an issue as Citi’s receipt of the bailout money makes it subject to the government’s pay czar, who must approve such huge pay packages. Hall himself has pushed for “a quiet divorce” from Citi, apparently not wanting to become the poster-boy for such controversial payouts.
Citi has held talks with potential buyers, the Financial Times reports, but no deal is imminent. If an outright buyer can’t be found, Citi would likely seek to sell a majority stake in Phibro.
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
The Federal Reserve keeps baby-stepping toward a “normalization” of monetary policy. But just what is normal?