Abu Dhabi sues Citigroup over its $7.5bn investment in US bank

[dipsydoodle]

Source: guardian.co.uk home Location

The oil-rich emirate of Abu Dhabi is trying to disentangle itself from a disastrous deal struck two years ago to shore up the finances of Citigroup in which it pledged to pump $7.5bn (£4.6bn) into the cash-strapped US bank's stock at a pre-arranged level ten times higher than Wall Street institution's present share price.

In a claim filed with arbitrators in New York, the Abu Dhabi Investment Authority has alleged "fraudulent misrepresentation" in connection with the commitment, which was negotiated before Citigroup was crippled by vast liabilities on mortgage-related securities and derivatives sullied by the global credit crunch.

If the investment from Abu Dhabi is thrown into doubt, the bust-up could affect Citigroup's plans for a $20.5bn fundraising needed to pay back $20bn of bailout money from the US treasury.

Read more: http://www.guardian.co.uk/business/2009/dec/16/citigroup-clashes-with-abu-dhabi-wealth-fund

[thereismore]

1. Arabs suing other Arabs for money. How low have they sunk. nt

[Romulox]

2. Don't worry. He's got this.

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