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Qatar continues diversification drive by upping Xstrata stake

10 Apr 2012

Qatar’s sovereign wealth fund has become the third-largest shareholder in mining giant Xstrata ahead of a planned takeover of the company by Glencore.

The Qatar Investment Authority now controls a five per cent stake in Xstrata worth about $2.65bn, which it has built up from three per cent since commodities trader Glencore announced it planned to create a combined company worth about $79 billion.

Qatar has recently been attempting to diversify its portfolio through purchases of French top-flight football team Paris Saint-Germain, luxury brands seller LVMH and oil company Total.

The fund’s increased stake in Xstrata is a boost for the Glencore takeover, which has been opposed by several majority shareholders.

Qatar has said it would be unlikely to vote against the proposed deal, which requires the backing of 75 per cent of shareholders excluding Glencore.

Private equity firm Blackstone is the second highest shareholder in Xstrata with just over five per cent, while Glencore owns just over one third of the company.

The purchase continues Qatar’s apparent policy of picking up large minority stakes in diverse companies without seeking to control the businesses.

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