Qatar fund is said to explore asset sales as new deals on hold

By Dinesh Nair, Ruth David and Archana Narayanan on 10/2/2017

LONDON and DUBAI (Bloomberg) -- Qatar’s sovereign wealth fund is weighing more asset sales after reducing holdings in Credit Suisse Group AG and Rosneft PJSC to support the country’s economy amid a standoff with its neighbors, according to people familiar with the matter.

The Qatar Investment Authority, which holds shares in companies ranging from Glencore Plc to Barclays Plc, is considering selling some of those stakes, the people said, asking not to be identified because the matter is private. The fund may use some of the proceeds to support the country’s financial sector and isn’t planning any new major investments, the people said.

The QIA, which was created to handle the windfall from the world’s largest liquefied natural gas export base, is reassessing its $320-billion portfolio as it comes under pressure to support Qatar’s economy. The fund last month sold $417 million of shares in Tiffany & Co., weeks after cutting its direct shareholding in Credit Suisse. The QIA and Glencore also agreed to sell most of the stakes they purchased in Rosneft at the end of last year.

Bankers and lawyers who used to pitch acquisition targets to the QIA are now proposing asset sales, and have been told not to expect any major investments by the fund in the near term, the people said. The fund hasn’t formally mandated financial advisers to sell assets but is considering which stakes are best positioned to be sold, they said.

The QIA declined to comment.

U.S. plans

The fund plans to spend most of what remains of its $45-billion investment target on U.S. assets as it seeks diversification, CEO Sheikh Abdullah Bin Mohammed Bin Saud Al Thani said last month.

The QIA is also considering selling some of its extensive property portfolio, especially in the UK where it owns stakes in London’s Savoy Hotel, the Shard skyscraper and the Olympic Village, according to another person familiar with the matter. The fund plans to sell an office building in London’s Canary Wharf financial district that is leased to Credit Suisse, people familiar with the matter said last month.

The QIA has injected billions of dollars into local banks to shore up liquidity, people familiar with the matter said in June, after some lenders in Saudi Arabia, the United Arab Emirates and Bahrain started withdrawing funds from the country, the people said.

Saudi Arabia, the UAE, Bahrain and Egypt severed diplomatic and transport links with Qatar on June 5, accusing the nation of supporting Sunni extremist groups and Iranian-backed militants. Qatar has repeatedly denied the charges.

The fund last year saw its biggest overhaul since 2014, grouping $100 billion of investments in local companies into a new unit and abandoning the Qatar Holding name synonymous with its highest-profile deals, people with knowledge of the matter said at the time.

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