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Abu Dhabi, UAEWednesday 19 December 2018

Qatar may sell trophy assets amid dispute with Arabian Gulf countries

The country's sovereigh wealth fund could dispose of holdings to channel money back home

The Qatar Investment Authority, which has reduced its direct holdings in Tiffany & Co. in recent months, is selling more of its assets. Michael Nagle / Bloomberg
The Qatar Investment Authority, which has reduced its direct holdings in Tiffany & Co. in recent months, is selling more of its assets. Michael Nagle / Bloomberg

One of the world’s biggest buyers of trophy assets is becoming a seller.

Isolated by powerful Arab neighbors, Qatar’s sovereign wealth fund is reversing a decade-long run in high-profile foreign investments to buttress its own economy.

The Qatar Investment Authority (QIA), which has reduced its direct holdings in Credit Suisse Group, Rosneft and Tiffany & Co in recent months, is considering selling more of its US$320 billion of assets, which includes stakes in Glencore and ­Barclays, and channelling the proceeds into its home market.

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 has not formally hired financial advisers to sell assets but is considering which stakes are best positioned to be sold, they said.

The QIA declined to ­comment.

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Read more:

QIA trims Tiffany stake in latest selldown amid economic crisis

Qatari investors sell stake in Luxembourg bank to Chinese investors

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Created in 2005 to handle Qatar’s windfall from liquefied natural gas sales, of which it is the world’s ­biggest exporter, the QIA and other Qatari investors have amassed holdings in ­Hollywood, New York office space, London residential property, luxury Italian ­fashion and even a football team.

The QIA ranks as the ninth largest globally, according to the Sovereign Wealth Fund Institute.

After a dip in transactions in 2015 and 2016 as oil prices slumped, the fund regained its appetite for deals late last year, investing in Turkey’s biggest poultry producer, Rosneft, and UK gas company National Grid, all within a couple of months. A Saudi-led dispute that started in June has put the brakes on those plans.

The QIA plans to spend most of what remains of its $45bninvestment target on US assets as it seeks diversification, chief executive Sheikh Abdullah bin Mohammed bin Saud Al Thani said last month.

The fund 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 a person familiar with the matter.

The QIA 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 after some lenders in Saudi Arabia, the UAE and Bahrain started withdrawing funds from the country.

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

The QIA last year ex­perienced its biggest overhaul since 2014, grouping $100bn 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.