Last updated: 1:41 am
August 27, 2009
Posted: 1:27 am
August 27, 2009
Hedge-fund hotshot John Paulson has been quietly snapping up shares of beleaguered Citigroup in recent weeks, sources tell The Post.
Paulson was said to have acquired a roughly 2 percent stake in Citi -- below the 5 percent threshold that would require him to disclose his investment stake in a securities filing, according to one source.
Although it's unclear what the hedge-fund master's rationale is for buying shares of the nation's most troubled bank, of which Uncle Sam holds a 34 percent stake, sources think that Paulson believes Citi's assets are undervalued.
One source said that Paulson sees Citi's shares trading closer to its book value of $5 to $7 a share, and that he has been scooping up shares in the bank over the past several weeks.
A spokesman for Paulson declined to comment on the hedge-fund manager's investment activities.
Lately, Citi's share price has seen a resurgence after having sunk to as low of $1.02 in early March on the back of worries it might collapse. Since late last month, when its shares were trading at $2.69, Citi's stock has shot up more than 70 percent, hitting a high of $4.82 on Monday.
Paulson's Citi moves come as it was revealed earlier this month that he is now one of the largest investors in Bank of America.
Sources say that Paulson, who fashioned himself into a billionaire with his bets on the housing collapse, is now keen to own financial institutions.