Turnpike not a conflict of interest, Citigroup says

May 22nd, 2008, posted by RobHop

One part of Citigroup was trying to save the state’s Turnpike Commission while another branch was bidding to take it over.

Turnpike officials say they’re certain the employees of Citigroup Global Market who have been advising them since early 2007 did not share financial data with Citi Infrastructure Investors, or CII, which is bidding to lease the toll agency.

The situation has prompted lawmakers, who are considering Gov. Ed Rendell’s turnpike lease proposal, to question Citigroup’s motives.

“I would hope there’s no conflict of interest there … but someone should verify that there was no conflict or connection between the subsidiaries,” said state Sen. Mary Jo White, R-Venango, who supports a turnpike lease. “I think it could be a deal-breaker if there was a conflict of interest. ... I’d have to know the extent of it.”

Michael B.G. Froman, a partner in Citi Alternative Investments, said Wednesday it is not unusual for two divisions of a large company to be involved in the same deal.
Source Link

Filed under:

It’s strange that the

On May 22nd, 2008 Anonymous said:

It’s strange that the State is unable to reduce Turnpike expenditures and provide the same benefit to taxpayers.
Is there something wrong with State Government that it can’t recognize the fact that they, themselves, could fix the problem without losing an asset for the next three quarters of a century?
Or, is this just one last looting of Pennsylvanians?

Proceed with Caution

On May 22nd, 2008 Anonymous said:

When the concept was first introduced, Rendell hoped it would bring bids of up to $30 billion; he noted the recent $12 billion bid was due to the current economic conditions. If PA is going to lease one of its major assets, which I have not decided in favor or against such a move, we should wait until the economy rebounds. If such patience would help to increase bid amounts and put PA in a better economic condition, then we must wait. Acting quick will not solve our woes.
I did appreciate one of the blogger’s statements: “It’s like borrowing against your house because your kids’ allowance is too high.”

Michael Grant