The Qatar Investment Authority (QIA) said on Thursday that a wholly owned subsidiary, Qatar Holding, had bought a 20% stake in the London Stock Exchange (LSE).
The Qatar group said it did not plan to make an offer for the London exchange, but reserved its position if a third party were to make a bid for the exchange. It said the LSE investment was for the long term.
The LSE said it welcomed the authority’s decision to take a 20% stake in the exchange as a long-term investor.
The LSE, Europe’s largest share market, said it had a long relationship with the QIA and believes that given the strength of Qatar’s economy and development of Doha as a major financial centre, there were “significant opportunities” to build further the relationship to the benefit of both.
“The QIA has an impressive track record of making substantial long term investments in growth companies, so we are delighted to see that it recognises the Exchange’s unique strategic position and excellent prospects,” LSE chief executive Clara Furse said in a statement.
“We look forward with confidence to delivering a full agenda and our wider global strategy,” she added.
Shares in LSE were up 10% at 1,598 pence by 1110 GMT, valuing the exchange at around 3.1 billion pounds.
Earlier, Nasdaq and Borse Dubai joined forces with a deal to buy Nordic markets operator OMX to create “a global financial marketplace” which will see Borse Dubai taking key stakes in the LSE and Nasdaq.
Under the deal state-owned Borse Dubai will end up with a 20% stake in Nasdaq and Nasdaq will take a strategic stake in Dubai International Financial Exchange (DIFX), which it said will be rebranded with the Nasdaq name and licensed to use Nasdaq and OMX market technology.
Nasdaq said it will take Borse Dubai’s existing stake in OMX. Borse Dubai will also buy from Nasdaq a 28% stake in the LSE but will continue with its 230 Swedish crown per share offer for OMX, which values OMX at around $4 billion, while Nasdaq will withdraw its current cash-and-shares bid.
The QIA has urged OMX shareholders to take no action over a revised conditional offer from US exchange Nasdaq and Borse Dubai.
In a statement, the authority said: “Qatar Investment Authority urges OMX shareholders to take no action with respect to the revised conditional offer by Nasdaq/Borse Dubai for OMX.”
“The Qatar Investment Authority is currently evaluating the situation with regards to the OMX,” it added.
According to sources familiar with the matter, investment bank Citigroup has been trying to buy shares in OMX in the market on behalf of the QIA.
One of the sources said late on Thursday that the bank is trying to buy 8 or 9% of OMX’s shares, prompting specultation it is close to taking on Borse Dubai with a rival offer for the Nordic exchange.
Citigroup declined to comment.
Data from the Stockholm stock exchange showed on Thursday Citigroup made a block trade in stock market operator OMX for 11.6 million shares at 260 crowns per share,
Citigroup will have been acting as both a buyer and a seller. The data does not indicate who the clients of any trade are, but it indicates who is handling the transaction.
In a separate trade, Citigroup handled 308,961 shares in OMX at the same price, according to the data carried by Reuters. Together, these blocks represent 9.9% in OMX.
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