Qatar runs returns rule over fast cars and football

Mon Apr 8, 2013 12:56pm EDT
 

By Mirna Sleiman and Dinesh Nair

DUBAI (Reuters) - Bankers and politicians touting their countries' wares have to work hard to get the attention of Qatar's sovereign wealth fund, such is the range of its interests, from banks to cars to soccer clubs, and its exacting requirement for returns.

With estimated assets of about $200 billion, and more than a dozen potential deals on its radar every week, the state-run firm has no time for less than compelling investment opportunities and hopes to make more than 17 percent on its book this year, according to one banker close to the fund.

In a series of interviews with top bankers and officials who deal with the fund, most of whom wished to remain anonymous due to their business relationships, Reuters probed the thinking behind the gas-rich Gulf state's investments and the future destination of its capital.

"There's clearly an open-door policy. Qatar has no mystery and no global mission to conquer the world. All it is buying strategic shares in big companies at an advantage," says a senior banker at a global bank who has worked on several deals for the fund.

Qatar Holding, the investment arm of the wealth fund, has been actively deploying the nation's riches from plentiful natural gas in recent years in a string of high-profile assets ranging from French soccer club Paris Saint-Germain to stakes in German sports-car maker Porsche, British bank Barclays and Swiss lender Credit Suisse.

The world's top exporter of liquefied natural gas has a lot of spare cash to invest; recent figures showed a budget surplus of $26 billion in the second quarter of fiscal year 2012/13, or 54 percent of GDP for the period.

"The state exports 6 million barrels a day of oil equivalent (1m oil and 5m gas). At $100 a barrel, that would give revenues of $200 billion a year," the banker close to the fund said.

"After spending on government and budgets, the remaining $50 billion are channeled to QIA for investments. Qatar Investment Authority invests $40-$50 billion a year."   Continued...

 
Paris Saint-Germain (PSG) players attend a training session at the Aspire Academy of Sports Excellence in Doha January 2, 2012. REUTERS/Fadi Alassaad