After spending nearly a year out of the public spotlight, Qatar’s colorful former prime minister, Sheikh Hamad bin Jassim Al Thani, is garnering international attention with a series of blockbuster financial deals funded in part by his vast personal fortune.
In recent months, companies controlled by Sheikh Hamad bin Jassim – widely known by his initials, HBJ – has bought UK-based Heritage Oil and purchased a stake in Germany’s Deutsche Bank in deals worth billions of dollars.
The businessman – who was also the country’s foreign minister and former CEO of the Qatar Investment Authority (QIA) – played a major role in the government of former Emir Sheikh Hamad bin Khalifa Al Thani, but was sidelined when the nation’s previous ruler abdicated to his son last summer.
Sheikh Hamad bin Jassim was replaced by Ahmad Al Sayed as head of QIA last July, a move the Financial Times at the time said “seals the demise” of HBJ.
That prediction may have been premature. Less than a year later, the same newspaper has proclaimed that HBJ has rejoined the global dealmaking stage, although his attention appears to now be on his personal finances, rather than those of the country.
“He always did these deals in the past, for himself and the government,” a senior Qatar banker said, as quoted by FT. “Now he is more focused on himself.”
‘I’m rich’
Earlier this month, HBJ gave his first media interview since leaving public office to American journalist Charlie Rose. During the wide-ranging discussion, the former prime minister – recently ranked the 125th richest person in the UK by the Sunday Times with a personal fortune of $1.35 billion – said his wealth came from his family and work as a merchant, rather than his former political position.
“Yes, I am not poor,” he told Rose. “I’m rich.”
As head of QIA, Sheikh Hamad bin Jassim oversaw Qatar’s sovereign wealth fund and led it to purchase stakes in foreign property, hotels, retail chains and automotive manufacturers, among other acquisitions – many of them high-profile.
He also personally co-invested in some of the deals, investing £533 million (US$897 million) in British bank Barclays through his personal firm, Challenger, alongside QIA’s £1.76 billion ($2.96 billion) stake.
Some months after leaving his government positions, HBJ quietly cashed out one of his major investments – and exited one of this country’s flagship businesses and strategic industries – by selling his near 50-percent stake in Qatar Airways to the government for an undisclosed amount earlier this year.
But the divestiture was quickly followed by this spring’s £924 million ($1.56 billion) acquisition of Heritage Oil, which controls fields primarily in Nigeria. That purchase was made by Al Mirqab Capital, where HBJ is the chief executive.
Earlier this week, Paramount Holdings Services – also controlled by HBJ – invested €1.75 billion ($2.4 billion) in Deutsche Bank as the German financial institution looked to bolster its balance sheet with fresh capital.
In an analysis of the deal, Forbes noted that shares of Western banks are still trading below their pre-financial crisis highs, making such firms an attractive long-term investment for those with patience.
Banking is also a sector that HBJ knows well. Along with the Barclays investment, QIA – through its direct investment arm, Qatar Holdings – holds shares in Credit Suisse, Bank of America and the Agricultural Bank of China.
Additionally, HBJ likely forged strong ties with Deutsche Bank during his time at QIA, said Victoria Barbary, the director of London’s Institutional Investor’s Sovereign Wealth Center, in an interview with the Wall Street Journal (WSJ).
“I suspect the relationship they had was with HBJ, so it makes perfect sense it would be the kind of thing he would be doing,” Barbary said. “He’s going to be an active investor in his own right rather than using the QIA.”
QIA without HBJ
The WSJ notes that activity at the QIA appears to have slowed down since HBJ departed.
Citing figures from Barbary, it reported that the QIA recorded roughly $4.3 billion in direct deals in the first six months of last year while HBJ was still at the fund. That dropped to less than $1 billion in the second half of the year.
However, the newspaper adds that bankers say the fund is still searching for direct investments, but in the meantime has shifted to a less-splashy strategy of investing in equities and stock market indexes.
Thoughts?