Prime Minister Laimdota Straujuma confirmed the identity of the buyer - which has been an open secret for months - during a break in the lengthy cabinet session, telling journalists the deal was "the best we could hope for."
Straujuma declined to give details of the deal other than to say that it would be signed by September 30 and that the European Bank For Reconstruction and Development (EBRD) which holds a 25% stake in the bank had also agreed with the terms offered.
Ripplewood founder Tim Collins said that in fact it was not Ripplewood per se that was making the purchase but instead he was putting his own private capital into the deal plus the capital of unnamed "famous international investors" whom he would represent.
"This investment is different... I decided that to have a longer term horizon I would invest with my colleagues directly and without the constraints of a private equity fund," Collins said.
"This is my capital and my colleagues' capital," he said.
Media speculation has named the price of the deal at between 107 and 113 million euros, though Latvian Television reported last week that Ripplewood had belatedly offered a considerably lower sum.
Citadele was formed from the wreckage of the notorious Parex bank which went spectacularly bust in 2008, dragging the entire country to the brink of bankruptcy and necessitating a 7.5-billion-euro bailout loan from the International Monetary Fund and European Union.
Ripplewood Holdings is a private equity firm founded by Tim Collins in 1995 and specialising in leveraged buyouts. It is based in New York and claims to have more than 10 billion dollars' worth of assets.