ADIA Endures Fight for Lost Billions in Citigroup Investment

The Abu Dhabi Investment Authority (ADIA) is exhausting all legal options to recover its loss from the US$ 7.5 billion Citigroup investment. In court, Second Circuit Judge Gerard Lynch was hearing arguments. David Elsberg of Quinn Emanuel Urquhart & Sullivan LLP and other lawyers from the firm are representing ADIA. Judge Gerard Lynch cited Elsberg of making “petty arguments” in a bid to restart ADIA’s suit against Citigroup. Elsberg argued the arbitration panel incorrectly applied New York law with regard to the dispute versus the laws of Abu Dhabi.

ADIA contended they were induced to make the Citigroup investment based on Citigroup’s “fraudulent misrepresentations” to ADIA.

ADIA’s Capital Infusion

ADIA defied surrendering on their US$ 7.5 billion investment in Citigroup that was made in 2007. Rewind the clock back to 2007, Citigroup was in need of a capital infusion – facing disastrous write-downs on their balance sheet. Citigroup’s king dealmaker, Michael Klein, was the chairman and co-CEO of Citi Markets and Banking. Klein had rooted relationships in the Middle East. He was groomed for the CEO position and negotiated the capital infusion Abu Dhabi’s largest sovereign wealth fund. To ink the deal, former Treasury Secretary under President Bill Clinton, Robert Rubin who became Citigroup’s chairman, took a flight to Abu Dhabi to finalize it. Rubin felt ADIA was a good choice, since Citigroup could only find a small number of institutional investors capable of making the investment on their own.[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

Contact the writer or creator of this article or page.
Questions or comments: support(at)swfinstitute(dot)org
Follow on Twitter at @swfinstitute and @sovereignfunds
Learn, Attend and Network: Institutional Investor Events and Summits
Go Back: HOME: Sovereign Wealth Fund Institute

institutional investor investment mandates