Barclays falls as Qataris offload 380 million shares

Barclays falls as Qataris offload 380 million shares

Shares in Barclays have been hit in early deals as its Qatari backers have decided to sell some of their holding in the banking group to institutional investors.

At 08.54, Barclay’s shares were down 16.65p, or 4.38%, at 365.4p.

The Qatari investors who had stepped in to shore up the group's capital at the peak of the crisis this time last year are selling 379 million shares in the market today in an accelerated book build; fuelling rumours the investment group now sees better upside from supermarket group Sainsbury's.

Almost a year ago, Barclays announced it had signed a deal with a group of Middle east investors that would see them take a combined 32% stake in the banking group which meant the group could go ahead without resorting to a government bailout.

The deal was roundly criticised for being more expensive than the government aid and because it excluded existing shareholders from taking part in the capital raising.

Qatar Holdings and other investors later agreed to allow institutional shareholders to buy some of their entitlement in a bid to win over opponents to the deal.

Having made hundreds of millions from the rally in Barclay’s shares, rumours began circulating in recent weeks that the investment group was looking to switch some of its investment into Sainsbury.

Barclay’s shares have climbed 87% since the deal was announced and the Qatari investor has made £750 million from today's sale.


But a spokesman for the banking group reiterated the sovereign wealth group's commitment to remain a long term investor in Barclays saying today's deal is part of its 'regular portfolio management.'

Ahmed Al-Sayad, chief executive and managing director of Qatar Holding, said: 'The decision does not impact on our current intention to remain a long-term strategic shareholder.'

Manoj Ladwa, senior trader at ETX Capital said: ‘The market has seen renewed interest in Sainsbury as traders bet on funds flowing out of the bank and into the supermarket.'

Sainsbury shares were leading the FTSE 100 risers on the back of the news, up 10p, or 3.03%, at 340.1p.

Meanwhile David Buik, a partner at BGC partners said the bookbuild has been well received.

'This is a great opportunity to buy into Barclays,' he said, pointing out that many believe Barclays is the banking group most likely to grow stronger after the crisis.

'If you are going to back any one of the four UK banks to make a quantum leap forward it is Barclays,' he said.

And Barclays' chief executive John Varley said the deal will help to broaden the banking group's share register.

citywire.co.uk