Citigroup's Parsons to be Providence senior adviser

Parsons, 61, will remain chairman of New York-based Citigroup, which will be his “primary business activity,” Providence said today in a statement.

“Dick is a highly regarded corporate leader and his counsel is regularly sought by boards, CEOs and government officials,” Citigroup said in a separate statement. “His advisory role at Providence will not require any day-to-day operational work or oversight, and his primary business activity absolutely will remain with Citi.”

Providence, a 20-year-old company that oversees more than $22 billion, specializes in buying media and telecommunications businesses. Parsons is a former chairman and chief executive officer of Time Warner Inc., owner of the Warner Bros. film studio. He will advise Providence, based in the Rhode Island city of the same name, on new investment ideas and on some of its existing investments, the company said.

Citigroup reshaped its board this year amid government pressure and criticism from shareholder-advisory groups after the company lost $28 billion in 2008. In February, Parsons said the board would be revamped with a majority of new independent directors. In July, the bank named three new members and replaced audit-committee head John Deutch.

'May Be Stretched'

“Given the shape that Citi is in, Parsons has a lot on his plate already,” said Amy Borrus, deputy director of the Council of Institutional Investors. “Citigroup is still trying to work through the mistakes made that put it in such bad financial shape last year. He may be stretched.”

Leveraged-buyout companies hire executives and former politicians as advisers to help buy and sell companies and raise new funds. Providence's investments include movie studio Metro- Goldwyn-Mayer Inc., Warner Music Group Corp., Yankees Sports & Entertainment Network and Univision Communications Inc., the largest Spanish-language television network in the U.S.

Parsons joined Time Warner as president in 1995 and was CEO from 2002 through 2007. He also served as chairman from 2003 through 2008. Time Warner plans to spin off its AOL Internet unit by the end of this year. Providence is among buyout firms that may bid for the Travel Channel, people with knowledge of the situation said yesterday.

Before joining Time Warner, Parsons was chairman and CEO of Dime Bancorp Inc. He had previously been managing partner of the New York law firm of Patterson, Belknap, Webb & Tyler. He was also counsel for former U.S. Vice President Nelson Rockefeller and a senior White House aide under President Gerald Ford.

“He will bring to bear his deep knowledge in the media industry to assist us with current investment and help identify new opportunities,” Providence CEO Jonathan Nelson said in the statement.

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