Citigroup begins $58 billion stock swap

Citigroup Inc (C.N) began a long-delayed $58 billion stock swap on Wednesday that is expected to make the U.S. government the bank's largest shareholder by far with a 34 percent stake.

The nation's third-largest bank plans to swap common stock for as much as $33 billion of preferred shares, and convert as much as $25 billion of preferred shares held by the U.S. Treasury into common stock.

Citigroup's swap could result in the issuance of more than 17 billion new common shares, diluting the holdings of existing investors by 76 percent. The public exchange expires July 24.

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- Posted: 2009-06-10 09:19:52

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