A fabulously wealthy Qatari investment fund is plotting an £8billion takeover bid for Marks & Spencer.
Shares in the much-loved store rose sharply at the end of last week due to City speculation that the Qatar Investment Authority, which manages the Gulf state’s wealth, is about to launch a bid.
The Qataris have been sounding out several private equity firms about forming a consortium to make a bid for M&S and have spoken to banks about loan finance.
Under threat? Qatar Investment Authority is reportedly planning a £8billion bid on Marks And Spencer
A takeover of M&S would mean yet another high-profile British company being surrendered to foreign ownership following the sale of a list of historic business names including Cadbury’s and ICI to overseas buyers.
It would also be the boldest move yet in Qatar’s multi-billion-pound UK shopping spree. The emirate recently bought the Olympic Village in East London. In 2010 it bought Harrods from Mohamed Al-Fayed.
Qatar has also taken large stakes in Sainsbury’s, the London Stock Exchange and Barclays, which it helped save from needing a bailout from the British government at the peak of the financial crisis.
Marc Bolland, chief executive of Marks & Spencer, is struggling to improve the performance of the 129-year-old company, which has 700 stores in the UK and employs 78,000 staff. The retailer reported a 1.8 per cent fall in sales over the key Christmas period and is valued on the stock market at £6billion.
Its shares were priced at 372.5p when the markets closed last week.
That is still well below the £4 a share Topshop tycoon Sir Philip Green offered in a failed bid for Marks nine years ago. Qatar is smaller than Belgium with a population of just under two million, but its population is the wealthiest on the planet thanks to its natural gas and oil reserves.
The sovereign wealth fund eyeing M&S is one of the most powerful in the world, and is run by the Qatari prime minister, Sheikh Hamad bin Jassim bin Jabr Al-Thani.
Its purpose is to invest the country’s oil and gas riches in various overseas assets so Qataris are less vulnerable to a fall in energy prices.
But critics fear Qatar’s treasure chest here could give it too much influence over corporate Britain.
The UK is also dependent on the Gulf state for 85 per cent of its supplies of liquefied natural gas.
Outside the UK, Qatar owns Paris St Germain football club, now home to David Beckham, and a large stake in Swiss bank Credit Suisse.
Despite the huge resources at their command, the Qataris often part-fund deals with borrowed money in order to reduce their financial risks.
Marks & Spencer and the Qataris declined to comment.