Citigroup Plans Huge Liquidation Sale Of Private Equity, Hedge Fund Units


Citigroup (C) is looking to sell its Citi Private Equity unit, according to Bloomberg, and hoping to raise as much as $10 billion in the process.

The first, obviously, is the cash. It will help with its ongoing deleveraging.

The second is the Volcker Rule, would likely have forced the company to dump the unit — which manages about $2 billion of the company’s money.

Other similar units will also be shown the door.

Other money-management units marked for sale or closure include the Citi Property Investors real-estate unit, which oversees $12.5 billion; and the Hedge Fund Management Group, which allocates money to hedge funds on behalf of its own investors, the people said.

Citigroup plans to keep Metalmark Capital LLC, a buyout firm the bank agreed to buy for an undisclosed sum in December 2007. Headed by former Morgan Stanley executive Howard Hoffen, Metalmark oversees almost $3.8 billion in several funds, one person said. It invests in energy, health care, financial and industrial companies, according to Metalmark’s Web site.

Evidently the bank feels MetalMark won’t be a problem at this point in terms of regulations.

The fund is also keeping an emerging markets VC group which, we’d imagine, won’t cause a huge problem, legally.

Bonus: 10 Hedge Funds Obama Just Kicked To The Curb >

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