E*Trade’s Shares Fall as Citadel Sells All 27.4M of its Shares

By FOXBusiness

E*Trade’s (NASDAQ:EFTC) largest investor, Chicago-based hedge fund Citadel, is selling its entire stake in the online brokerage.

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The announcement, made late Wednesday, pushed shares of the New York-based financial-services company down nearly 6% to $11.13 in Thursday morning trade.

Citadel, which sold just fewer than 27.4 million shares, declined to comment. E*Trade did not immediately respond to FOX Business.

The offer is slated to close around March 19, subject to customary closing conditions, with Citigroup (NYSE:C) acting as sole underwriter. E*Trade said it will not receive any proceeds from the sale and the total number of shares outstanding will not change.

Citadel first invested in E*Trade in November 2007. E*Trade’s shares have fallen some 87% since then and it has gone through seven chief executives.

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The company, which has struggled amid low trading volumes that hit at the heart of the Great Recession, is now concentrating on winding down its bank loan operations. E*Trade on Wednesday said its loan portfolio has been reduced by 3% so far this year to $10.3 billion.

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