Citigroup had little choice but to sell Andrew Hall's Phibro


Citigroup (C) superstar trader Andrew Hall is now Occidental Petroleum's (OXY) headache.

Occidental today agreed to buy Phibro, the commodities trading operation that Hall headed, which has become an albatross around Citigroup's neck because of Hall's $100 million pay package. Neither company addressed the pay issue in their press releases, and officials could not be immediately be reached. Los Angeles-based Occidental plans to invest about $250 million in Phibro.

For Citibank, retaining Hall and his colleagues would be too high of a price to pay for the gigantic public relations headaches that they would cause. People can argue that a contract is a contract, but an angry member of Congress is a pretty scary sight, particularly when you're Citigroup and you need all of the friends in Washington you can get.