Citigroup is nearing a deal to sell $12bn in leveraged loans at a discount to a group of leading private equity firms, marking another step in new chief executive Vikram Pandit's efforts to shrink the beleaguered bank's balance sheet.
Although details of the deal were still being worked out, people familiar with the matter said Apollo Management, the Blackstone Group and TPG will buy the loan portfolio at a discount, which could come in at about 90 cents on the dollar.
The Citi portfolio includes loans used to finance acquisitions by Apollo, Blackstone and TPG, as well as debt in their rivals' deals. Apollo would buy about half the portfolio, with Blackstone and TPG taking the rest. Citi declined comment.
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