Citigroup Unloads $100 Million Man: Reports
By LEANNE GENDREAU
Updated 10:36 AM EST, Fri, Oct 9, 2009
Citigroup has unloaded a rather successful energy-trading firm after getting heat over a deal to pay the quirky owner a whopping $100 million bonus – after the federal bailout fiasco.
Citigroup has sold Phibro, a reportedly secretive Westport-based energy-trading firm, to Occidental Petroleum Corp. an oil and gas exploration and production company.
Andrew Hall, a Southport man and CEO, is the man at the center of the controversial bonus that got the attention of the federal pay tsar. He runs the reportedly secretive Westport-based energy-trading firm Phibro LLC, which operates out of a former Connecticut dairy farm and has , according to news reports.
Hall and employees will remain with the company after closing, which is expected to happen by the end of the year.
Occidental’s net investment in Phibro would be about $250 million.
And, about that $100 million? "Significant portions of current and future bonuses will be deferred and retained by Phibro and paid out in future years," according to Occidental Petroleum Corp. Future payouts will be adjusted to reflect Phibro's results during that period.
If the past is any indication of the future, those results will be pretty impressive.
From 1997 until the second quarter of 2009, Phibro made an average $200 million per year in pre-tax earnings.
Over the last five years Phibro's earnings averaged $371 million per year. Phibro has been profitable each fiscal year since 1997, attaining profitability in 80 percent of all quarters.
First Published: Oct 9, 2009 8:38 AM EST
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