Citadel rode to the rescue of E*Trade in 2007, injecting $2.5 billion to help keep the troubled discount brokerage alive. Since then, it has become increasingly evident that the investment was a dud. E*Trade stock has fallen about 60 percent. Along the way, the hedge fund has sold off at least half its original stake.

But the issues continue to mount, and the anger is spilling into public. The hedge fund, which owns nearly 10 percent of the stock, is making clear the fact that it would like some sort of exit event.

"We believe a sale of the company could be achieved promptly and generate significantly higher shareholder value, avoiding the risks of operating as an independent company lacking leadership and financial capabilities," Citadel's Steven Freiberg wrote in the letter to E*trade's chairman. It said that if E*Trade does not call a special meeting by July 22, it would request a meeting pursuant to certificate of incorporation. Citadel also pressed for a host of corporate governance changes, including more independent directors and an enbd to the staggered term board structure.

The news gave the stock a pop. But the big question here is whether any company would want to buy the troubled brokerage. TD Ameritrade has long been rumored as an interested acquirer. We'll have to see if they're still interested.

For more:
- here's an article from CNNMoney

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Citadel eases up on redemptions