Citadel Investment Group

From Wikipedia, the free encyclopedia

You have new messages (last change).

Citadel Investment Group is a $13.4 billion [1] hedge fund based in Chicago, Illinois, founded by billionaire trader Kenneth C. Griffin. It is one of the world's largest hedge funds. The firm's daily trading volume amounts to approximately 3% of daily trading activity in New York and Tokyo. The fund requires longer "lock-up" periods from investors than many other hedge funds. Though Citadel employs over 1,000 individuals globally, its flagship operation is located in Citadel Center, a $355 million office tower in downtown Chicago (in 2006 the tower was purchased for $560 million by Robert Gans) [2] [3]. Citadel also has offices in New York, Tokyo, Hong Kong, San Francisco, and London [4]. Of the 100 largest hedge funds, only Citadel is based in Chicago [5]. Citadel is the eleventh largest hedge fund in the world [5]; it is also the second largest multi-strategy hedge fund in the world [6].

Despite prior talk in Wall Street that Citadel was considering an IPO and Kenneth C. Griffin mentioning that possibility in an interview, in April 2006 a spokesman for Citadel said the firm currently has no such plans [7]. However, in November 2006 Citadel became the first hedge fund to publicly issue debt bonds. In an arrangement managed by Goldman Sachs and JP Morgan, Citadel announced it would sell $2 billion worth of notes. [8] The bonds have been given an investment-grade rating by Standard & Poor's. [9].

Contents

[edit] Investments

Citadel reportedly has a large stake in Google [10], Conor Medysystems [11], Alexion Pharmaceuticals [12], FirstFed Financial Corporation [13], uranium [14] (an $11 million stake in Cameco) [15], Dow Jones & Co., KB Home [16], Enzon Pharmaceuticals [17], K-V Pharmaceutical Company [18], the London Stock Exchange [15], and Banta Corporation [19]. In November 2002, Citadel invested $100 million in Xcel Energy [20]; in November 2006, Citadel agreed to invest $28 million in mining company China Shen Zhou [21].

In 2004, Citadel founded CIG Re, a Bermuda-based catastrophe reinsurer [22]. In 2005, the hedge fund founded a $500 million catastrophe reinsurer in Bermuda called New Castle Re [23].

Citadel also has multiple subsidiaries such as Kensington Global Strategies (Citadel's largest fund [24]), Wellington Partners [10] (Citadel's oldest fund and its flagship fund [25]), Citadel Equity Fund [26], Citadel Finance [1], and Citadel Derivatives Group, which controls 10% of the Philadelphia Stock Exchange [2]. In 2000, Citadel's Wellington affiliate achieved a 52.6% return [3]. Since January 2005, Citadel Derivatives Group has been a Lead Market Maker on the trading floor of the Pacific Coast Exchange [4]. In a strategic partnership with about ten other financial institutions, Citadel Derivatives Group is also a joint owner of the International Securities Exchange [5].

In 2006, Citadel and JP Morgan Chase became white knights after taking over the energy division of Amaranth Advisors, which had suffered a 65% ($6 billion) loss in assets [6] [7].

Citadel's daily trading activity reportedly accounts for "more than 10% of daily U.S. listed equity options contract volume" [8].

[edit] Other information

Citadel Investment Group is not related to Citadel Investment Services, a South Africa-based wealth management group, or Citadel Group, a global financial services firm. Two other firms, New York based mortgage broker Citadel Investments and Chicago based Citadel Group, a healthcare financing organization, are unrelated to the hedge fund or its affiliates.

[edit] See also

[edit] Notes

  1. ^ Bloomberg News. "Citadel fund among best in '06", Chicago tribune, 2001 January 5. Retrieved on 2006-01-27.
  2. ^ Carr, Robert. "Citadel Center Trades in $560M Transaction", globest, 2006 October 27. Retrieved on 2006-01-27.
  3. ^ "Dearborn Center Announces 206,146 Square Foot Lease with Citadel", Beitler RE Corp, 2001 March 9. Retrieved on 2006-01-27.
  4. ^ "Harbin Electric Closes $50.0 Million Financing", Harbin Electric, 2006 August 31. Retrieved on 2006-01-27.
  5. ^ a b Rose-Smith, Imogen. "Land of the Giants", Alpha magazine, 2006 2006, pp. 3. Retrieved on 2006-01-27.
  6. ^ Hutchins, william. "Citadel leads the way in financial self-sufficiency", Financial Times, 2006 December 8. Retrieved on 2006-01-27.
  7. ^ Reuters. "Citadel Investments to stay private", Crain's, 2005 April 29. Retrieved on 2006-01-27.
  8. ^ Reuters. "Citadel to sell up to $2 billion in debt", Crain's, 2006 November 28. Retrieved on 2006-01-27.
  9. ^ Anderson, Jenny. "INSIDER; Some Hedge Funds Decide That Relying on Banks Is Just Too Risky", The New York Times, 2006 December 1. Retrieved on 2006-01-27.
  10. ^ a b Mannes, George. "Citadel Storms Into Google", thestreet.com, 2004 November 15. Retrieved on 2006-01-27.
  11. ^ "Citadel Boosts Stake in Conor Medsystems (CONR) to 5%", thestreetinsider, 2006 September 28. Retrieved on 2006-01-28.
  12. ^ "Citadel LP Raises Stake in Alexion Pharmaceuticals (ALXN) to 5%", thestreetinsider, 2006 October 12. Retrieved on 2006-01-28.
  13. ^ "Citadel LP Discloses 5.3% Stake in FirstFed Financial (FED)", thestreetinsider, 2006 November 2. Retrieved on 2006-01-28.
  14. ^ Nones, Jones. "Is uranium the new investment of choice for hedge funds?", Resource Investor, 2006 November 6. Retrieved on 2006-01-28.
  15. ^ a b Evans, Gavin, Christopher Donville. "Uranium, Energy Choice of Tudor, Adit, to Beat Oil, Metals", Bloomberg, 2006 November 6. Retrieved on 2006-01-28.
  16. ^ "Smart Money Flexes Muscles in Battleground Homebuilder Stocks", findprofit, 2005 October 13. Retrieved on 2006-01-28.
  17. ^ "Citadel LP Accumulates 5.4% Stake in Enzon Pharmaceuticals (ENZN", thestreetinsider, 2006 November 15. Retrieved on 2006-01-28.
  18. ^ "Citadel LP Raises Stake in K-V Pharmaceutical (KV.a) to 5.5%", thestreetinsider, 2006 November 15. Retrieved on 2006-01-28.
  19. ^ "Citadel Buys Banta Shares", Graphic Arts monthly, 2006 August 23. Retrieved on 2006-01-28.
  20. ^ Wieffering, Eric. ""xcel")&p_perpage=10&p_sort=YMD_date:D&xcal_useweights=no Borrowing costs jump for Xcel", Star Tribune, 2002 November 13, pp. 1D. Retrieved on 2006-01-28.
  21. ^ "China Shen Zhou Mining & Resources Signed a $28.0 Million Financing", secinfo, 2006 November 22. Retrieved on 2006-01-28.
  22. ^ Zuill, Lilla. "Hedge fund investments in reinsurance broaden", The Royal Gazette, 2005 August 22. Retrieved on 2006-01-28.
  23. ^ finanzanch. "Citadel forms catastrophe reinsurer New Castle Re - AM Best", AFX & marketwatch, 2005 April 11. Retrieved on 2006-01-28.
  24. ^ Toomre, Lars. "Citadel Investment Group Off to Flying 2006 Start", Toomre Capital, 2006 March 13. Retrieved on 2006-01-28.
  25. ^ Maday, Tom. "Meet Ken Griffin", Cover Story, Institutonal Investor, 2001 September. Retrieved on 2006-01-28.
  26. ^ Morgan Lewis (2004 October 14). Court halts investor squeeze out by DEPFA Deutsche Pfandbriefbank AG. Press release. Retrieved on 2006-01-28.

[edit] External links

Retrieved from "http://en.wikipedia.org../../../c/i/t/Citadel_Investment_Group_5644.html"