News Column

UPDATE: Qatar Sovereign Wealth Fund Confirms Sale Of Near 5% LSE Stake

July 10, 2014

Steve McGrath

LONDON (Alliance News) - The Qatar Investment Authority, the Qatari sovereign wealth fund, Thursday confirmed that it has sold about a third of its stake in the London Stock Exchange Group PLC, leaving it with a stake of about 10.3% in the exchange operator.

In a statement, the Qatari fund said the deal was part of its "routine" portfolio management, and it doesn't expects to sell any more LSE shares in the immediate future. The share sale was done through a block sale managed by Citigroup and Merrill Lynch. It didn't say exactly how many shares were sold, but the fund held a 15.08% stake before the block sale.

"Qatar Holding continues to believe in the management and long term prospects of LSE, and does not expect to dispose of any further shares in LSE in the immediate future," it said in a short statement.

The sale by Qatar Investment Authority comes ahead of the LSE's USD1.60 billion rights issue in September, money it will use to help fund its USD2.70 billion acquisition of Russell Investments, the operator of benchmark equity indices widely used by US fund managers.

The acquisition will enable the LSE to combine Russell's index business with FTSE, bringing together USD5.2 trillion of assets benchmarked to Russell and an estimated USD4.0 trillion of equities benchmarked to FTSE. That will make it a major player in the global indexes market, better able to compete with the likes of MSCI and S&P Dow Jones.

The Qatar Investment Authority initially bought a 20% stake in the LSE in 2007, part of a series of transactions that kept the LSE independent just as it was the target of a potential takeover attempt by rival Nasdaq OMX.

LSE shares had risen 12.8% so far this year up until Wednesday's close. The stock was down 3.7% at 1,884.00 pence Thursday morning, the third-biggest decline on the FTSE 100.

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Source: Alliance News

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