GIC makes $1.6bn on Citigroup sale

From: beng1 <5191 ...="""">
Date: Wed, 23 Sep 2009 07:01:31 -0700 (PDT)
Local: Wed, Sep 23 2009 10:01 pm
Subject: GIC makes $1.6bn on Citigroup sale

GIC makes $1.6bn on Citigroup sale
The Government of Singapore Investment Corporation (GIC) has realised
a $1.6bn (£977m) profit on its investment in Citigroup after reducing
its stake in the troubled bank to below 5pc.

By James Quinn
The GIC, one of Singapore’s two key sovereign wealth funds, originally
invested in the banking conglomerate in January 2008 as part of a
$14.8bn fund-raising.

The GIC exchanged $6.88bn of convertible preferred shares in Citigroup
for ordinary shares this summer as part of a wider share exchange, and
the sovereign wealth fund ended up with a holding in excess of 9pc,
while the US government holds 34pc.

In a statement, the fund said it made a $1.6bn gain on yesterday’s
share sale, and it also has a $1.6bn paper profit on the less than 5pc
stake it now holds in Citigroup. The profit is a by-product of the
four-fold increase in Citigroup’s shares since the start of March. The
share price rose 21 cents to $4.64 yesterday.

The GIC’s investment compares favourably with that of Temasek —
Singapore’s smaller sovereign wealth fund — which has sold stakes in
both Barclays and Bank of America at a loss.

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