Lampert Slashes Stake in Citigroup as Shares Fall
NEW YORK (Reuters) - Billionaire investor Edward Lampert has slashed by nearly one-third his stake in Citigroup Inc (C.N), the largest U.S. bank, a regulatory filing shows.
RBS Partners LP, an affiliate of Lampert's hedge fund ESL Investments Inc, reduced its stake 31 percent to 19.08 million shares as of Dec. 31 from 27.79 million shares as of Sept. 30, according to a Thursday filing with the U.S. Securities and Exchange Commission. The value of RBS' stake fell to $561.8 million from $1.3 billion.
Citigroup shares fell 36.9 percent in the fourth quarter, hurt by losses tied to subprime mortgages, soured loans, and complex debt such as collateralized debt obligations. Chief Executive Charles Prince resigned in November, and was succeeded the following month by Vikram Pandit.
In January, the bank posted a record $9.83 billion fourth-quarter loss, slashed its dividend 41 percent, cut 4,200 jobs, and said market conditions would remain difficult.
"So much value has been destroyed," said Ralph Cole, who helps invest $2.5 billion at Ferguson, Wellman Capital Management in Portland, Oregon, which sold its Citigroup shares in November. "Lampert may have thought he was buying better assets, and many of these got totally wiped out."
A spokeswoman for Greenwich, Connecticut-based ESL declined to comment. Shannon Bell, a spokeswoman for New York-based Citigroup, declined to comment.
RBS Partners first disclosed investing in Citigroup last May 16, when it revealed a 15.24 million share stake worth $782.6 million as of March 31.
Lampert is also chairman of Sears Holdings Corp (SHLD.O), and is overhauling management and operations to help the retailer compete more effectively with rivals such as Wal-Mart Stores Inc (WMT.N) and J.C. Penney Co (JCP.N).
Before founding ESL in 1988, Lampert worked at Goldman Sachs & Co. That firm's top executives at the time included Robert Rubin, who later became U.S. Treasury Secretary and now chairs Citigroup's executive committee. Rubin briefly served as the bank's chairman after Prince's departure.
RBS in its filing showing holdings as of Dec. 31 also disclosed a 3.29 million share stake worth $38.6 million in Acxiom Corp (ACXM.O), a data management company. It did not report a stake in Clear Channel Communications Inc (CCU.N), the radio station operator, after reporting a 464,600 share stake worth $17.4 million as of Sept 30.
Citigroup shares closed Thursday down 60 cents at $25.74 on the New York Stock Exchange. They fell 47 percent last year, and are down 50 percent since last March 31.
(Editing by Phil Berlowitz)
