Citadel Acquires 6.3% Stake in Teen Retailer Abercrombie

Billionaire Ken Griffin’s Citadel LLC bought a 6.3 percent stake in Abercrombie & Fitch Co. (ANF), adding to increased interest in the teen retailer by hedge funds in the past three months.

Griffin and funds of Chicago-based Citadel held 5.2 million Abercrombie shares as of Nov. 14, according to a regulatory filing today. The hedge fund is the third-largest investor, data compiled by Bloomberg show.

Citadel made the purchase after activist investor Ralph Whitworth’s Relational Investors LLC built a 5 percent stake in the New Albany, Ohio-based company, according to data compiled by Bloomberg. The investor has pressed for changes at the retailer, a person familiar with the matter said in September.

Abercrombie surged a record 34 percent on Nov. 14 after raising its annual profit forecast and posting third-quarter earnings that exceeded analysts’ estimates. It was a reversal compared with August, when the retailer reported an 8 percent decline in same-store sales in the six months ended in July and forecast a 10 percent decline for the second half of the year.

Citadel, which has pressured E*Trade Financial Corp. to sell itself as the company’s largest shareholder, trades about 13 percent of U.S. equity volume through its securities unit, according to its website.

Abercrombie’s shares had declined 10 percent this year through yesterday, compared with a 25 percent increase in the Standard & Poor’s 500 Retailing Index. The stock fell 2.2 percent to $42.83 at 12:36 p.m. in New York.

Activist investor Daniel Loeb’s Third Point LLC exited its position in Abercrombie in the second quarter, selling 1.85 million shares, data compiled by Bloomberg show.

-- With assistance from Allan Lopez in New York. Editors: Cecile Daurat, Kevin Orland

To contact the reporters on this story: Sapna Maheshwari in New York at sapnam@bloomberg.net

To contact the editor responsible for this story: Robin Ajello at rajello@bloomberg.net