* New firm backed by sovereign wealth fund assets
* To raise $3 bln in Doha public offering
* To have separate management from Qatar Holding -source
By Regan Doherty
DOHA, Feb 19 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.
"You name it - shares, bonds, real estate, private equity.
We will look at every sector in every country around the world,"
Hussain al-Abdullah, Qatar Holding's vice-chairman, said at a
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 the Gulf nation'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.
"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 R.
Seetharaman, chief executive of Doha Bank.
Qatar Holding will transfer $3 billion worth of assets into
the new firm, with a similar amount raised in an initial public
offering on the Qatar Exchange. A source familiar with the
matter said a further $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
a second source familiar with the deal.
"The company will run independently from 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."
Some bankers expressed doubt over whether the company could
be launched as quickly as Qatar hopes.
"The announcement is pretty surprising, and it's a brave
move by Qatar. Most of their investments are either bespoke or
in listed entities. There is a risk that it may open up their
books significantly," a senior banking source in Dubai said.
The IPO is open only to Qataris, but foreign investors will
be able to buy in later.
Qatar Holding's investments are widely seen as
opportunistic, not following a specific strategy, as it has
purchased a wide range of assets globally. Qatar, the world's
richest country per capita, has also invested in other Arab
states partly to boost its political clout.
The sovereign fund had a rate of return of 17 percent last
year, Qatar Holding's Abdullah said on Tuesday.
"This is a global investment company to invest overseas, not
in Qatar," he 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
The first source said Qatar Holding would spin off $3.5
billion worth of assets into the firm at a discount value of $3
The assets will include local as well as global assets, the
second source said.
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
"We don't see an immediate rationale for a move like this,
other than maybe sharing the wealth of the nation with citizens,
but they have a lot of other companies in petroleum, steel,
water treatment which should go (public) first," the Dubai
banking source said.
Credit Suisse, in which the sovereign wealth fund owns a 6.2
percent stake, is advising Qatar Holding.