Qatar to list $12 billion investment firm on QE

TRIBUNE NEWS NETWORK

DOHA QATAR will create a new $12 billion investment firm, backed by blue-chip assets from its sovereign wealth fund, and list it on the local stock exchange, its main institutional backer said on Tuesday.

Qatar Holding, the investment arm of the Qatari sovereign fund, said the new firm will invest in assets around the world. “We will look at every sector in every country around the world,” Qatar Holding Vice-Chairman Hussain al Abdullah said.

Qatar Holding will transfer $3 billion worth of assets to the new firm, with a similar amount raised through an initial public offering on the Qatar Exchange.

A source familiar with the matter said an additional $6 billion will be raised at a later date. “The rationale is very simple. Diversify assets and let the people of Qatar enjoy the state’s power in global markets,” said another source familiar with the deal.

“The company will run independently of Qatar Holding,” the second source said. “Its board will be represented by Qatar Holding and members from the private sector. Once the board is in place, a new CEO and management will be appointed.” “This is a global investment company to invest overseas, not in Qatar,” Qatar Holding’s Abdullah said, adding it planned to guarantee a 5 percent dividend in its first year.

It was not immediately clear which assets would be transferred to the new firm, called Doha Global Investment Company. The first source said Qatar Holding would spin off $3.5 billion worth of assets into the firm at a discount value of $3 billion. The assets will include local as well as global assets, the second source said.

“Listing a company of this magnitude will stimulate more wealth distribution down the line. It will give Qataris a chance to be part of the country’s growth and will bring in sophisticated foreign investors once it’s listed,” said Doha Bank CEO R Seetharaman.

Qatar Holding, believed to have assets in excess of $100 billion, has been the most active of the region’s sovereign wealth funds in recent years, deploying Qatar’s riches from plentiful natural gas to buy stakes in companies ranging from German sports car maker Porsche to British bank Barclays and Swiss lender Credit Suisse.

Responding to a question, Abdullah also said that Qatar is to invest more than $17 billion till 2017 in the local industrial sector and outside the oil and gas sector.

Abdullah, who is also a board member of the Qatar Investment Authority, said the listing would take place in six to eight weeks on the Qatar Exchange, which seeks to rival Dubai as a financial hub.