NEW YORK, Nov 26 (Reuters) Citigroup Inc said on Monday it agreed to sell .5 billion worth of Equity Units, to be converted into common shares, to the Abu Dhabi Investment Authority (ADIA).
Citi said ADIA's ownership in its common shares would total no more than 4.9 percent of all Citi's shares outstanding.
''This investment, from one of the world's leading and most sophisticated equity investors, provides further capital to allow Citi to pursue attractive opportunities to grow its business,'' Win Bischoff, Citigroup's acting chief executive said in a statement.
The dollar jumped 1 percent against the yen, and U.S. Treasuries extended losses after the deal was announced.
The dollar rose to 108.45 yen, pulling away from a 2 1/2-year low hit on Monday as the sale is expected to offer a shot of funds into Citi, which has been one of the hardest hit banks from subprime mortgage defaults and the resulting credit crunch.
Tokyo's Nikkei erased a 2.1 percent fall, trading up 0.8 percent after the mid-session break. Citi shares traded in Japan nearly halved their losses, down 4.7 percent after the news.
Under terms of the agreement, ADIA will have no special rights of ownership or control and no role in the management or governance of Citi, including no right to designate a member of the board of directors.
The ADIA is scheduled to receive units convertible into Citi shares at prices ranging between .83 and .24 each between March 15, 2010 and Sept. 15, 2011.
That would be a premium of 6.8 percent to 25 percent to Citi's closing price of .80 on Monday.
The Equity Units will also pay a fixed annual payment rate of 11 percent on a quarterly basis.
The investment is expected to close within days, Citi said.
REUTERS SLD DS1137