Oil revenues write big cheques: stock exchanges and equity groups targeted

From today’s Sydney Morning Herald:

Abu Dhabi agreed on Thursday to pay $US1.35 billion ($1.57 billion) for 7.5 per cent of Carlyle Group, the world’s second-biggest private equity firm. Dubai and Qatar took competing stakes in the Nasdaq stockmarket, London Stock Exchange and Nordic bourse OMX. Qatar also won approval to examine the financial records of J Sainsbury, the second-largest UK supermarket chain.

The deals are worth $US25 billion, data compiled by Bloomberg shows. The pace of international investments by Gulf states, which earn $US1.2 billion a day from oil exports, is quickening as they seek to diversify. They have already spent a record $US68 billion on overseas acquisitions this year.

“They are not just putting their money in bank deposits and government bonds any more,” said Eckart Woertz, the chief economist for the Gulf Research Centre in Dubai. “They are after strategic assets.”

Strategic assets indeed. Talk abounds moreso about possible take-over action with respect to the London Stock Exchange.

Should be interesting – we should remember, still, what happened the last time a Qatari outfit went in for a strategic asset (and DP World’s picking up of US ports was an accident – those were owned already by a foreign company, just an English one. English is okay; Qatari is not – as though anybody can track ownership of anything these days). DP World had to off-load the P&O part of the English parent, but now we see big stakes being taken in the likes of the Carlyle Group, the Nasdaq and the LSE (and the Dubai Bourse in fact bought Nasdaq’s share of the LSE – it isn’t as though we ought to be protesting against only one of those two partners, now, is it? Though I’m sure we will).

We anticipate the reaction of the local (New York) Murdoch tabloids. If they can STFU about Clinton, Giuliani or the Yankees for 5 freaking minutes.


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