Does Prince Alwaleed Want to Buy the U.S.'s Stake In Citigroup (C)?

October 5, 2009 12:15 PM EDT

Large Citigroup (NYSE: C) shareholder Prince Alwaleed bin Talal told Emerging Markets magazine that the U.S. government should sell their stake in the bank as soon as this year to boost investor confidence.

Alwaleed was quoted as saying, "The earlier the U.S. government exits its investments in those companies, the better." He also stated, "We need to give confidence back to the shareholders and investors that these companies are moving along without government support."

The U.S. government currently own 7,692,307,692 common shares, or 33.6% of outstanding shares of Citigroup, following an exchange offer in September. The shares can be sold at any time, and while reports have surfaced the government will start to exit the stake, nothing has yet been sold.

Alwaleed said "Citigroup has learned a huge lesson. The worst is behind them right now." He also noted that the bank's $100 billion of tangible common equity is the highest in the industry.

Maybe the comments from Prince Alwaleed could suggest that the sultan would be interested in talking to the U.S. government about buying their huge slug of Citigroup. He would be one of the few in the world that could actually make such a transaction, valued at about $36 billion based on the current market price. But then one would have to ask - "If Prince Alwaleed was a buyer of the U.S. stake why would he be talking up the price?"

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