Qatar, Kuwait said to eye stake in Lloyds Bank

Sovereign wealth funds reportedly vying for some of government's 39% stake worth $30bn
By Courtney Trenwith
Thu 25 Jul 2013 01:47 PM

Qatar and Kuwait are said to be interested in buying a stake in Lloyds Banking Group when the UK government sells its 39 percent holding, worth about £20bn ($30.7bn).

The government plans to sell its stake in the UK’s largest bank by market share in three tranches.

The first is expected to be released within weeks but only offered to existing institutional investors including L&G, Blackrock, Norges, Fidelity, Schroders and Standard Life, at a 5-10 percent discount, according to London’s Daily Mail.

The second offer, also to institutions, is likely to be staged in the spring, with the retail offering in summer 2014.

Sovereign wealth funds from Qatar, Kuwait and Singapore are believed to be interested in acquiring a stake.

Vice-chairman of US private equity firm Corsair Capital, Lord Davies, is reportedly putting together a consortium to invest.

The potential buyers would have to offer a premium to be able to win over UKFI, the government body that manages the taxpayer stake, according to the Daily Mail.

Qatar already has significant investments in the UK, including London department store Harrods.

Lloyds is reshaping itself as a smaller, simpler and stronger group.

It has a market capitalisation of nearly £50bn and total assets of about £900bn are much smaller than its rival’s £1.5tn.

Lloyds is expected to report a significant improvement in profits when it announces its mid-year results next week. Analysts are forecasting a profit of more than £2bn compared to a loss last year.

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