Overseas investment decision for case 200810012 - Citigroup Inc. of United States of America

The application has been approved as it met the criteria.

The Overseas Investment Office is satisfied that the individuals with control of the Applicant collectively have business experience and acumen relevant to the overseas investment, and that the Applicant has demonstrated financial commitment towards the overseas investment. The Overseas Investment Office is further satisfied that each individual that exercises control over the Applicant is of good character and is not an individual of the kind referred to in section 7(1) of the Immigration Act 1987.

Background to the Investment:
Citigroup Japan Holdings Limited (Citigroup Japan), a wholly-owned subsidiary of Citigroup Inc (Citigroup), currently owns 68.11 percent of the shares in Nikko Cordial Corporation (Nikko) (refer A200720140). Nikko is a diversified financial services holding company whose subsidiaries are principally engaged in retail and wholesale securities brokerage, investment banking, asset management and merchant banking activities primarily in Japan.

As a result of this acquisition Citigroup has acquired an indirect interest in a group of New Zealand companies including the Hirequip Group and the Fleet Partners Group.

Outline of the Investment:
On 31 October 2007, Citigroup Japan and Nikko entered into a definitive share exchange agreement whereby all of the shareholders in Nikko, other that Citigroup Japan, will exchange their Nikko shares for shares in Citigroup, and Nikko will be de-listed.

Rationale for the Investment:
Citigroup and Nikko have built a strong co-operative relationship over a period of time including Nikko Citigroup Limited, a joint venture investment bank incorporated in February 1999, and NikkoCiti Trust and Banking Corporation, a joint venture trust bank jointly operated since 2001. Citigroup became a shareholder in Nikko in 1998 and considers the strategic relationship as a key part of its business in Japan.

Citigroup and Nikko formed the alliance to create one of Japan's leading financial services groups and to enable the combined group to pursue new growth opportunities.