QATAR’S sovereign wealth fund today announced it was cashing in more than 379 million Barclays share options in a move fuelling further speculation over its interest in Sainsbury’s.
Qatar Holding said it was selling the shares in Barclays after taking up so-called warrants giving it the right to buy the bank’s stock. The move - part of a "portfolio management programme" - will net the investor more than £1.3 billion.
The news sent Sainsbury’s shares up more than 3.5% as the developments added to speculation of stake-buying in the retailer following last week’s takeover rumours, which sent the grocer’s shares soaring 20% at one stage.
Shares fell back at the end of last week due to the lack of any statement from either Sainsbury’s or the Qataris, who took a 26% stake in the retailer more than two years ago through investment firm Delta Two.
But today’s announcement fanned the flames of the takeover speculation, which comes after Delta Two made a £10.6 billion takeover attempt for Sainsbury’s in July 2007. That approach was scuppered amid the credit crunch and the failure to agree a funding deal with the trustees of the group’s pension scheme.
Qatar Holding’s decision to offload its share options in Barclays had the opposite impact on the bank’s shares, as the market saw it as a sign to lock-in profits.
The bank’s shares dropped 5% despite assurances from the Qataris that they will remain a "long-term strategic shareholder" in Barclays.
Qatar Holding’s original 7% stake in the bank also remains unaffected by the deal.