Despite subprime woes, Citigroup firms up Nikko buyout |
| MarketWatch - Jan 18, 2008 |
Fresh from raising $12.5 billion in new capital to help it cure a subprime loans hangover in the U.S., Citigroup Inc. Friday plowed ahead with plans to buy out minorities in its Japanese brokerage unit Nikko Cordial Corp. (8603.TO), in a share swap deal worth $5 billion.
Citigroup confirmed it will pay Nikko Cordial shareholders the equivalent of Y1,700 of its stock for each Nikko share they own. Working out at 0.602 Citi share for each Nikko share, that overall headline price per Nikko share is in line with plans Citi announced for its 68%-owned Japanese brokerage Nov. 14.
The move does remove some doubts about the New York-based bank's overseas strategy as it seeks to fix subprime-related problems. But a slide in Citigroup's share price brought on by those subprime woes since the deal was first agreed means the U.S. bank now has to pay more in its own stock for each share in Nikko than originally intended.
Read Full Article from MarketWatch
- Posted: 2008-01-18 09:40:34
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