Sovereign Wealth Fund Institute

The Qatar Investment Authority (QIA) is nearly completing the acquisition of Credit Suisse’s London headquarters. The QIA would pay £330 million for the property located in the financial district called Canary Wharf. There will be a separate sale-and-leaseback agreement to be used with Credit Suisse. The 21 floor office property is at 1 Cabot Square in London’s Canary Wharf. The building is 540,000 square feet in area.

The QIA has been an active investor and developer in English real estate. Other notable large deals in the past with Qatar’s sovereign wealth fund include, the former Chelsea Barracks site, development of Shell’s International headquarters, and development of the Olympic Village project.

The Qatar Investment Authority owns around a 6% stake in Credit Suisse and has used the bank for deals. In addition, the QIA and the China Investment Corporation own shares in UK Songbird which is the majority owner of the Canary Wharf Group.

Domestic strategic development is a major goal for countries. Qatar and other oil-based economies are trying to diversify from their lucrative natural resource sector. In fact, sometimes countries can utilize a sovereign wealth fund to stimulate demand in specified sectors within a country. We have witnessed the creation of science parks and educational cities spread throughout the gulf region. The Qatar Investment Authority (QIA) is rumored to be planning to spend around US$ 2 billion into asset management firms to lure them into Doha. This strategy has somewhat worked for other gulf cities.
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According to Reuters, “Three Gulf Arab sovereign wealth funds and UAE-based property developer Al Maabar have raised 15 billion dirhams for a tourism fund that aims to put Morrocco among the world’s top 20 destinations.  Omar Bennani, who heads state-controlled Moroccan Touristic Engineering Company (SMIT), said the four investors were Bahrain’s Mumtalakat, the Kuwaiti Investment Authority (KIA), Qatar Investment Authority (QIA) and Al Maabar of the United Arab Emirates.

“The contribution of the four partners is of at least 15 billion dirhams … They are committed to support us throughout the next 10 years,” Bennani told Reuters in an interview on Wednesday.

He said the investors did not want their individual contributions to the Moroccan government-backed fund be made public. The fund aims to attract 100 billion dirhams in investment.

The fund will finance resort developments in Morocco that aim to more than double tourism receipts to 150 billion dirhams by 2020.”

Read more: Reuters

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According to Reuters, “Hassad Food, owned by Qatar’s sovereign wealth fund, plans to acquire a sugar project in Brazil, the state-run Qatar News agency said, citing the firm’s chairman.

Qatar, like other Gulf states, imports the majority of its food requirements, and securing future food supplies is seen as a priority by the government.

The acquisition in Brazil is expected to take place in two months time, Nasser al-Hajri told QNA, giving no further details of the project.

Around 70 percent of the sugar is planned to be shipped to Qatar for domestic use, while the remaining 30 percent will be used to produce bio-fuels, QNA said.”

Source: Reuters

According to Businessweek, “Qatari Diar Real Estate Investment Co. plans to raise $3.5 billion in a bond sale, the Financial Times reported. Qatari Diar, the property arm of Qatar’s sovereign wealth fund, is expected to launch a roadshow for the sale in London as early as tomorrow, the FT said.

Qatar Diar Finance, the unit issuing the bond, was rated Aa2 by Moody’s Investors Service, which also gave a provisional rating of Aa2 to the proposed bonds, the newspaper said.”

Read more: Businessweek

According to Reuters, “The Qatar Investment Authority, the Gulf country’s sovereign wealth fund, agreed to invest $2.8 billion in Agricultural Bank of China Ltd.’s initial public offering to tap growth in the world’s third-biggest economy.

The $58 billion fund signed an agreement with Agricultural Bank on June 17, two people with knowledge of the matter said, declining to be identified because the deal is private. The bank has allocated more than $5 billion for corporate investors such as QIA in the Hong Kong part of its IPO, the people said.

Agricultural Bank, China’s largest lender by number of customers, is seeking to raise as much as $15 billion in the Hong Kong part of what may be the world’s largest IPO, according to an e-mail sent to investors last week. The Beijing-based lender may sell as much as $28 billion of stock in Hong Kong and Shanghai combined, exceeding the $22 billion sale by Industrial & Commercial Bank of China Ltd. in 2006.”

Read more: Reuters

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According to Emirates Business, “Qatar Holding, the investment arm of Qatar’s sovereign wealth fund, has set up a $1 billion (Dh3.67bn) Indonesian fund to invest in infrastructure and natural resources in Southeast Asia’s biggest economy, officials said yesterday. The new investment fund is a sign of increasing interest in Indonesia among Middle East and other international investors thanks to the country’s abundant resources and desperate need for financing for infrastructure projects ranging from power plants to roads, railways, and bridges. Qatar’s existing interests in Indonesia include Qatar Telecommunication Co’s 65 per cent stake in Indonesia’s second-biggest telecom company, PT Indosat. Gita Wirjawan, head of Indonesia’s investment coordinating board, said that the local investment vehicle, PT Qatar Holding Indonesia, was set up a few days ago. “The main focus area will be on mineral resources and infrastructure projects,” Wirjawan added.”

read more: Emirates Business

According to the AFP, “Barclays survived the international credit crunch without government support unlike rival British banks that were bailed out by the taxpayer.

Instead, the group won a seven-billion-pound capital injection largely backed by Abu Dhabi and Qatar. Abu Dhabi has since sold most of its holding, while Qatar’s sovereign wealth fund, the Qatar Investment Authority, has trimmed its Barclays stake.”

read more: AFP

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According to The Times, “The historic Raffles Hotel in Singapore, famed for its colonial grandeur and the Singapore Sling cocktail, is to change hands in a deal worth $275 million (£180 million). The luxury 103-room hotel, a favourite watering hole of literary figures including Somerset Maugham and Rudyard Kipling, looks set to be acquired from Fairmont Raffles Hotels International by Qatari Diar, part of the state-controlled sovereign wealth fund, the Qatar Investment Authority.

Talks over a deal come a year after The Times reported that Prince Alwaleed Bin Talal, the Saudi billionaire who controls Fairmont Raffles, had secretly put the 123-year-old hotel up for sale with an asking price of more than $350 million — a story that was later denied by the Prince’s Kingdom Holding Company.

News of a possible sale of Raffles comes hot on the heels of the purchase this week by Qatari Diar of a 40 per cent stake in Fairmont Raffles itself, a deal that reduces Kingdom’s stake from 58 per cent to 35 per cent. Colony Capital, the American property and private equity investor, is cutting its holding to 22 per cent. The $847 million headline price comprises $467 million for a 40 per cent stake, another $105 million in the form of hotel management contracts that Qatari Diar will award to Fairmont Raffles on a number of other hotels it owns, plus $275 million for an unnamed hotel property.”

read more: The Times

According to BusinessWeek, “Two top Qatari leaders said the country is interested in buying a stake in French nuclear power producer Areva SA. Qatar plans to invest in Areva as soon as the two parties reach an agreement, Qatar Investment Authority board member Hussain al-Abdulla and Minister of State for Energy Mohammed al- Sada said at an energy conference in Paris today. The investment authority is Qatar’s sovereign wealth fund.

“I don’t know exactly how long it will take but certainly there is an interest from the Qatari side,” al-Sada said during a press conference. “It’s under discussion.”

He declined to say how large the holding in Areva might be or when the purchase could take place. Areva Chief Executive Officer Anne Lauvergeon, who also attended the energy conference, declined to comment on the deal.

Qatari Prime Minister Sheikh Hamad Bin Jasim Bin Jaber Al- Thani said on Feb. 10 that Qatar was considering an investment in Areva.”

read more: BusinessWeek

According to Maktoob, “The Qatar Investment Authority, or QIA, has acquired shares in Al Rayan Bank last year for 191 million Qatari riyals ($52.5 million), Doha-based Al Arab daily reports Thursday citing the bank’s financial statements. This is part of Qatar’s sovereign wealth fund’s plan to acquire 10% of the country’s largest shariah-compliant bank, the paper reports, adding that it couldn’t know whether the shares bought in 2009 cover the full 10%-stake QIA pledged to acquire. The acquisition was carried out through the local bourse, the daily reports citing the bank also known as Masraf Al Rayan.”

read more: Maktoob

According to Bloomberg, “Qatar, the world’s largest producer of liquefied natural gas, expects the construction of a railway system will cost 17 billion euros ($25.3 billion) as the Persian Gulf state seeks improved transport links with its neighbors.

Qatari Diar Real Estate Investment Co. and German state- owned rail operator Deutsche Bahn AG formed Qatar Railways Development Co. today to build the network in three phases by 2026, Qatari Diar Chief Executive Officer Ghanim bin Saad al- Saad said.

Financing and the budget for the project will be announced very soon, he told reporters in Doha. Qatari Diar is part of the country’s sovereign wealth fund.

Gulf states are channeling crude-oil and gas earnings into railways and airports as they develop infrastructure to help economic development and attract foreign investors and tourists. Dubai, the second-biggest of seven sheikhdoms that make up the United Arab Emirates, in September opened the first metro system in the Gulf Arab countries. Oil-rich Abu Dhabi is conducting studies to build a rail system in the U.A.E. capital.

‘The signing of this agreement shows that German expertise and German technology in the transport sector are in demand the world over,’ Transport Minister Peter Ramsauer said today in a statement.

Qatar’s rail network will integrate projects such as a high-speed link between the gas-rich emirate’s capital Doha and its airport, and a link with Bahrain via a causeway, the companies said in a statement. Qatar will also get passenger and freight links between Doha and the industrial cities of Ras Laffan and Mesaieed, freight lines to other countries and a metro system in the capital.Qatari Diar owns 51 percent of the rail company with Deutsche Bahn holding the rest.”

read more: Bloomberg

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According to Bloomberg, “Qatar made 615 million pounds ($1 billion) by selling shares in Barclays Plc a year after it helped bail out Britain’s second-biggest bank.

Qatar Holding LLC, an arm of the Doha-based Qatar Investment Authority, sold more than 379 million Barclays shares at 360 pence each, sale manager Credit Suisse AG said today in a statement. The firm acquired the shares by exercising warrants at 197.775 pence. Barclays fell as much as 5.6 percent.

Barclays raised more than 5 billion pounds from Middle Eastern investors last year, triggering criticism from shareholders including Legal & General Group Plc who weren’t first given an opportunity to buy new stock. Barclays has surged since touching a March low, as it avoided government aid unlike Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc. “

read more: Bloomberg

Bloomberg reports that, “Qatar’s ruling emir, who toppled his father in a bloodless coup in 1995, has come out on top of another power struggle thousands of miles away in Germany, where the Porsche dynasty is losing control of the sports-car maker. Porsche SE yesterday agreed to combine with Volkswagen AG after a four-year attempt to take over the larger German rival left Porsche paralyzed with debt. Qatar will own 17 percent of VW with options accumulated from Porsche, making the Gulf kingdom the third-largest investor in Europe’s biggest carmaker. Qatar used its $63 billion sovereign wealth fund to give the world’s second-richest country behind Liechtenstein investment clout, snapping up stakes in established brands or troubled companies in need of cash. Four years after its inception, the fund has become the biggest shareholder in Barclays Plc, J. Sainsbury Plc and Credit Suisse AG.”

read more: Bloomberg

AFP reports that, “the German luxury sports car maker Porsche has scheduled an extraordinary meeting of its supervisory board on July 23 to discuss offers by Qatar and Volkswagen, sources said on Friday. A Porsche spokesman confirmed the meeting, while a source close to the supervisory board said the Qatar and VW offers would be discussed. Invitations were extended by Wolfgang Porsche, head of the supervisory board, the spokesman said.

Heavily-indebted Porsche recently received an offer from the Qatar Investment Authority and has expressed confidence it would reach agreement on selling a direct stake in Porsche along with VW stock options.

A deal would allow Porsche to pay off some of the nine billion euros (12.6 billion dollars) in debt it accumulated trying to increase its holding in VW, the biggest European car maker. Porsche currently owns about 51 percent of VW. But VW has also made a counteroffer for 49 percent of Porsche’s core sportscar operations in a boardroom drama between the carmakers’ dominant influences, the Porsche and Piech families. Discussions with Qatar have been troubled by the dispute between the two groups.”

read more: AFP

Qatar will announce the details of the country’s sovereign wealth fund’s bid to buy into indebted German sports carmaker Porsche within two to three weeks, Qatar’s prime minister said. Sheik Hamad Bin Jassem Al Thani refused to confirm reports that the Qatar Investment Authority is eying a 25 percent stake in Porsche Automobil Holding SE, saying that the investment fund is still in the negotiating stage about the stake.

In a meeting Tuesday night with businessmen in the Qatari capital, Hamad said the QIA and Porsche are legally bound to not disclose details for now. But “within two or three weeks, the picture will become clearer,” the prime minister added.

read more: Business Week

The Guardian reports that, “Qatar’s sovereign wealth fund, one of the world’s largest investors, has put buying on hold for the next six months and will then focus more on energy and commodities in a major strategic overhaul.

‘For the next six months we will do nothing,’ said Hussein al-Abdullah, executive director of the Qatar Investment Authority, a sovereign wealth fund with assets recently estimated to total $60 billion.

‘Beginning in the second half of the year, we will review our strategy. The sectors we will focus more on are commodities, food, energy and water because it is an important sector and the prices will pick up,’ he told reporters on Thursday on the sidelines of a conference in Dubai. Sitting on up to $4 trillion in assets, much of it from selling oil and other raw materials, most SWFs have been conservative in their investment choices, holding dollars, treasuries and shares in large U.S. and European companies.”

read more: Guardian

Reuters reports that, “Qatar has asked its sovereign wealth fund to buy local banks’ investment portfolios to boost liquidity and encourage lending, a finance ministry official said on Tuesday.

The Gulf Arab oil and gas exporter said on Monday it will buy the portfolios without saying how much it had allocated to carry out the programme, which sent stocks soaring.

‘The main goal of this measure is to provide the necessary liquidity to the banks in order to facilitate lending,’ Khalaf al-Mannai, undersecretary for the finance and economy ministry told Reuters in a telephone interview.”

read more: Reuters

According to Venture Beat, “Fisker Automotive, maker of a luxury plug-in hybrid vehicle called the Karma, has squeezed an additional $3 million out of its private investors, bringing its total capital raised to more than $100 million — a staggering feat considering the state of the credit market. The Irvine, Calif. company raked in $65 million in September but says the recent addition to its third round is just the right amount to put finishing touches on the Karma before it rolls into showrooms.

The $3 million addition came from Quantum Fuel Systems Technologies, Kleiner Perkins Caufield & Byers, Al Gharrafa Investment, Palo Alto Investors and Thomas Lloyd Capital. Qatar Investment Authority joined existing investors in the $65 million tranche in the fall.”

read more: Venture Beat

According to the press release, “South African Deputy Foreign Minister Sue van der Merwe will hold the first round of bilateral consultations with the Assistant Foreign Minister for Follow-Up Affairs of the State of Qatar Mr Mohammed Abdullah Al-Rumaihi at the Twelve Apostles Hotel and Spa in Camps Bay, Cape Town on Wednesday 04 February 2009.

Qatar Investment in South Africa and Africa
The Qatar Investment Authority has invested US$400 million in an investment fund, the PME Infrastructure Management Limited Fund. The fund is investing in infrastructure in Africa and is concentrating on the areas of transportation, communication and energy. According to the Government of Qatar, South Africa is the biggest beneficiary and of this fund which is considered to be the first investment by the Qatar Investment Authority in South Africa.

South African Investments in Qatar
South African companies have been fairly successful in obtaining contracts for major projects in Qatar. Sasol and Qatar Petroleum entered into a US$900 million joint venture gas-to-liquid facility at Ras Lafan. The plant was inaugurated on 6 June 2006 by the Minister of Minerals and Energy Bulelwa Sonjica.”

read more: South Africa – Department of Foreign Affairs

Sovereign wealth funds are taking some of the biggest hits during the latest round of economic uncertainty. CNBC’s Maria Bartiromo spoke with Sheik Hamad Al-Thani, Qatar’s prime minister and CEO of the country’s largest investment authority.

watch here: CNBC

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According to FT, “The outcome of Delta Two’s bid for Sainsbury rests in the Qatar Investment Authority [QIA]’s hands as the Qatari backer processes a request for GBP 500m of additional equity financing. This was said by people close to the situation on Tuesday.

Sainsbury shares are down 6% to 547p since Friday’s announcement, but there were no indications on Tuesday that either side considers the 600p proposed deal to be in jeopardy, as long as QIA approves the additional funding in time.

Delta Two has already said that QIA would support and develop the business through further equity investment. The QIA has to pass Delta Two’s request through its internal approval mechanisms in the same way as any investment fund and this takes a certain amount of time, it was explained. A spokesperson for the QIA declined to comment.”

Read more: FT