KHC investments begin: 1991
Based: New York, New York, USA
Citigroup is a core investment for KHC and, since 1991, among its most consistently successful.
Citigroup represents a unique situation in which a privately negotiated investment was made in 1991 in new preferred shares at a time when Citigroup’s predecessor Citicorp was experiencing financial difficulties. Following KHC’s successes in the Saudi Arabian banking sector, the company identified Citicorp as an undervalued company with strong brand assets and significant potential for growth. By negotiating an investment at a time of great financial uncertainty for Citicorp, KHC was able to acquire a significant amount of Citicorp shares at a valuable discount to the market price – a bold decision that subsequently proved phenomenally profitable.
KHC’s investment played a key role in renewing market confidence in Citicorp, and having demonstrated high levels of support for the rejuvenated company, KHC remained a core shareholder as it undertook a period of huge corporate transformation that saw the group make key acquisitions, such as Travelers, Smith Barney, Salomon and Schroders.
Citigroup is the world’s leading global bank with approximately 200 million customer accounts and transacts business in more than 160 countries and jurisdictions. Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services and wealth management.
Citi is organized into Citicorp and Citi Holdings. Citicorp represents Citi's core banking businesses and future growth opportunities, while Citi Holdings contains businesses and assets that are not core to the future of Citi. Citicorp includes the company's core global institutional and retail banking operations and serves businesses and consumers around the world. The Citicorp segment is focused on providing best-in-class products and services to grow the franchise profitably, reduce volatility and leverage the company's competitive advantages.
Citi's strategy for the future is to focus on the key forces driving global growth in financial services: value-added services, such as cash management, the flow of world trade, capital and business and the growth of emerging markets.