April 11 (Bloomberg) -- Todd Thomson, the former Citigroup Inc. executive ousted over expenses and his ties with CNBC television anchor Maria Bartiromo, set up a company to invest in real estate while he seeks to join rivals of his old employer.

Headwaters Capital is involved in real estate development and some advisory work, Thomson said in an interview today. He's also agreed with Citigroup on terms of his exit package, which he declined to discuss.

Thomson said he's talking about his future with firms ``ranging from private equity companies to investment banks to other banking institutions.''

Citigroup replaced Thomson, 46, as head of its brokerage and private-banking unit in January. While the company gave no reason for the dismissal, people familiar with the situation said it was partly because of his ties with Bartiromo. Thomson approved a $5 million sponsorship for a television series she was to co-anchor.

Thomson wouldn't comment on the specifics of his dismissal or how Citigroup handled it. The Financial Times reported the agreement on his severance package earlier today.

``I'm very pleased with the settlement and I'm excited to move on,'' Thomson said.

Citigroup, the biggest U.S. bank, announced plans today to reduce annual spending by $4.6 billion in the next three years and eliminate 17,000 jobs. Shareholders have pressed Chief Executive Officer Charles Prince to boost profits after earnings rose 7 percent last year, compared with JPMorgan Chase & Co.'s 70 percent.

Hired by Weill

Thomson was replaced by Chief Financial Officer Sallie Krawcheck, 42. Both arrived at Citigroup as outsiders recruited by Prince's predecessor, Sanford Weill. As senior executives in their 40s, they were among the handful of candidates to succeed Prince, 57.

Thomson joined Weill's Travelers Group Inc. as head of global development in July 1998, three months before the company completed its merger with Citicorp. Previously, he worked at GE Capital Services, a financial arm of General Electric Co., Barents Group and Bain & Co.

The wealth-management unit's revenue rose 17 percent last year under Thomson to $10.2 billion.

To contact the reporter on this story: Yalman Onaran in New York at yonaran@bloomberg.net.

Last Updated: April 11, 2007 12:49 EDT