Citigroup Inc (C)

[kei]

UPDATE 1-Citi confirms sale of private equity unit

http://www.reuters.com/article/idCAN1324168620100713?rpc=44

NEW YORK | Tue Jul 13, 2010 9:17am EDT

NEW YORK July 13 (Reuters) - Citigroup Inc (C.N) has agreed to sell its private equity unit to StepStone Group LLC and Lexington Partners, the bank said on Tuesday.

The sale will reduce Citigroup's assets by about $1.1 billion as the bank continues to unload unwanted assets from its Citi Holdings repository.

The unit being sold includes Citigroup's fund of funds, mezzanine funds, feeder funds and co-investment businesses, the bank said on Tuesday.

StepStone will provide management and advisory services for the unit's $4 billion fund of funds, feeder and co-investment funds, Citigroup said. Lexington will buy a portion of the bank's proprietary capital investments in the various funds and provide oversight for the co-investment portion of the unit.

Thomson Reuters Corp's (TRI.TO) peHUB reported the planned sale last week. [ID:nN07158060]

Citigroup did not disclose the deal terms on Tuesday, but the peHUB report said the unit would be sold for more than $900 million, at a slight discount to its net asset value and a small premium to its holding value.

Citigroup said the deal was expected to close early in the fourth quarter. (Reporting by Maria Aspan; editing by John Wallace)