Treasury Backs Off Plan to Sell Citi Stock

Prices were so low taxpayers would have lost $770M
By Kate Seamons,  Newser Staff
Posted Dec 17, 2009 8:01 AM CST
Treasury Backs Off Plan to Sell Citi Stock
Pedestrians walk by the Citigroup building on July 17, 2009 in New York, New York.   (Getty Images)

The Treasury has done an about-face on its plan to unload part of its 34% stake in Citigroup. The reversal comes as investors responded tepidly to the offering of as much as $5 billion in stock, forcing Citigroup to sell at a discounted price of $3.15 a share—10 cents below what the Treasury paid for its 7.7 billion shares, reports the Wall Street Journal.

Rather than lose upwards of $770 million on its Citibank investment, the embarrassed Treasury said it now plans to sell off its stock gradually over the next year, a shift from the plan, announced Monday, to unload it in as soon as six months. (More Citigroup stories.)

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