Citigroup to sell 40pct stake in Chilean unit for $300m

Citigroup Inc, the New York-based bank that’s selling assets to pay down debt, agreed to sell its 40 percent stake in Chilean pension-fund administrator AFP Habitat for gross proceeds of about $300m. The transaction won’t have a material impact on net income, Citigroup said today in a statement. The Habitat stake was one of more than 20 businesses and other investments that Chief Executive Officer Vikram Pandit tagged for eventual sale or closure last year to streamline the company following its $45bn US government bailout. “This transaction is consistent with Citi’s strategy to focus on our core businesses, while optimizing value for our shareholders by reducing assets and managing risks,” said Michael Corbat, CEO of Citi Holdings, the division formed by Pandit to oversee the business sales. The bank said this week that Citi Holdings assets had shrunk to $547bn as of December 31 from $662bn a year earlier. Citigroup repaid $20bn of bailout funds in December. The US government still owns about 27 per cent of the bank, because the Treasury Department last year converted the other $25bn of bailout funds into 7.7bn of Citigroup’s common shares.