We are forced to temporarily suspend publishing whilst we secure our economic survival. For almost a year we have been fighting an unlawful financial blockade. We cannot allow giant US finance companies to decide how the whole world votes with its pocket. Our battles are costly. We need your support to fight back. Please donate now.
DONATE ›
Legal Costs: $1,200,000
| Reference id | aka Wikileaks id #241125 ? |
| Subject | Abu Dhabi Investment Authority Sues Citi |
| Origin | Embassy Abu Dhabi (United Arab Emirates) |
| Cable time | Tue, 22 Dec 2009 10:10 UTC |
| Classification | CONFIDENTIAL//NOFORN |
| Source | http://wikileaks.org/cable/2009/12/09ABUDHABI1161.html |
| History | |
| Extras | ? Comments |
VZCZCXYZ0000
RR RUEHWEB
DE RUEHAD #1161 3561010
ZNY CCCCC ZZH
R 221010Z DEC 09
FM AMEMBASSY ABU DHABI
TO RUEHC/SECSTATE WASHDC 0057
INFO GULF COOPERATION COUNCIL COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHINGTON DC
Hide header
C O N F I D E N T I A L ABU DHABI 001161
SIPDIS
NOFORN
DEPARTMENT FOR NEA/ARP/BMCGOVERN AND EEB/IFD/OMA
E.O. 12958: DECL: 2019/12/22
TAGS: EFIN [Financial and Monetary Affairs], EINV [Foreign Investments], ECON [Economic Conditions], AE [United Arab Emirates]
SUBJECT: ABU DHABI INVESTMENT AUTHORITY SUES CITI
CLASSIFIED BY: Richard G. Olson, Ambassador, State, Embassy Abu
Dhabi; REASON: 1.4(B), (D)
¶1. (SBU) On December 15, Citigroup announced that the Abu Dhabi
Investment Authority (ADIA) had filed an arbitration claim based on
Citi's alleged misrepresentation of ADIA's November 2007 $7.5
billion investment. The arbitration claim seeks $4 billion in
damages. ADIA originally agreed to buy Citi securities that
yielded 11 percent annually and would convert to 235.6 million
shares (a 4.9 percent stake) at prices ranging from $31.83 to 37.24
starting in March 2010. Since then, Citi's stock price has fallen
to less than $3.50/share. Adding to ADIA's losses, Citi's recent
issuance of 5.4 billion new shares significantly dilutes ADIA's
original 4.9 percent stake.
¶2. (C/NF) A well-connected expatriate financial consultant told the
Ambassador on December 16 that this stock dilution finally spurred
ADIA to take action. ADIA Senior Legal Advisor William Brown told
EconOff on December 17 that ADIA, as an investment entity
representing Abu Dhabi's citizens, must exercise its fiduciary
duty. Failure to do so would damage ADIA's reputation as a
sovereign wealth fund for the people of Abu Dhabi. Brown said ADIA
was historically disinclined to take legal action, but advisors
finally convinced the leadership to act. Brown unequivocally
stated that Citi "lied" and must be held accountable.
OLSON
Media
Comments
Do not load Disqus comments widget (Disqus loads and executes third-party Javascript files, which might be deemed undesirable. Setting will take effect next time a page is loaded.)
User-supplied contents reflect the views of their respective authors, and not necessarily the views of the owner and/or moderator(s) of this web site. Posts with embedded links will have to be approved by a moderator. Only links to external web pages which appear to contribute complementary information to specifics in the cable will be allowed. Links to external web pages should not be construed as a statement of support of the external web sites by the owner and/or moderator(s) of cablegatesearch.net.
these highlights