Treasury to liquidate more Citigroup stock

The Treasury Department said today it is selling another 1.5 billion shares of the Citigroup Inc. stock it received in exchange for taxpayer aid through the Troubled Asset Relief Program.

 

Morgan Stanley, Treasury's agent, will have discretionary authority to divest the shares through a trading plan that involves 12 other securities brokers. That plan will run until the end of the year.

 

Treasury injected $45 billion in Citigroup in late 2008. The financial services giant repaid $20 billion of that money last year, and the remainder was converted to common stock, which gave taxpayers a roughly 27 percent stake in the company.

 

To date, Treasury has liquidated 4.1 billion of its 7.7 billion Citigroup shares, generating $16.1 million in gross proceeds.  The new round of sales will cut its stake in the company to approximately 7 percent.

 

Citigroup's shares closed Monday at $4.17. At that price, the 1.5 billion shares being marketed would bring nearly $6.3 billion.

 

So far, Treasury has recouped $41.6 billion of its Citigroup investment, through repayments by the company, dividends , the sale of its common stock and the sale of other securities.

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