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Citadel in $2.55bn E-Trade injection

Citadel, the hedge fund company run by billionaire Ken Griffin, swooped to take advantage of another distressed company in the battered financial sector, pumping $2.55bn into troubled online brokerage E-Trade.

The move further establishes Citadel as the leading bail-out firm for ailing financial sector companies.

Earlier this year, the $15bn company swallowed the credit portfolio of Sowood Capital, a hedge fund which had run up heavy losses in mortgage-related markets. And late last year, along with JPMorgan, it bailed out Amaranth, the US hedge fund which blew up after a disastrous bet on the direction of natural gas prices

Its latest cash injection comes amid persistent rumours of a takeover of E-Trade, fuelled in part by rising concerns about the impact on its business of the US subprime mortgage crisis.

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http://www.ft.com/cms/s/0/a986c0fc-9ee5-11dc-b4e4-0000779fd2ac.html