Qatar swoops for Greek assets as Europe looks abroad for help

 

A Qatari sovereign wealth fund has taken a 10 per cent stake in a Greek gold-mining firm, in a move that confirms that European politicians are increasingly keen to accept assistance from emerging economies in order to ease the eurozone's debt crisis.

The deal by Qatar Holdings to buy a 9.9 per cent equity stake in European Goldfields from the Greek construction firm, Ellaktor, was approved on Saturday by the Greek Prime Minister, George Papandreou, and the emir of Qatar, Sheikh Hamad Bin Khalifa Al-Thani.

"We have built a very strong bond of mutual respect, and we Greeks are especially pleased that this bond leads to investments in our country," Mr Papandreou said following the meeting. Ahmad al-Sayad, the chief executive of Qatar Holdings, which is also the owner of Harrods, said: "Hopefully this will have a positive impact on the local [Greek] economy."

He also indicated that he is looking for further acquisitions across Europe. "We are open for opportunities in Europe and in Germany," he said in an interview with German newspaper Handelsblatt.

The Goldfields deal is expected to create between 1,500 and 2,000 jobs in the crisis-stricken Mediterranean country. The Qataris will also provide the gold miner with a $600m (£385m) loan facility and shareholders will be offered $150m of loan notes. If these loan notes are taken up and Qatar Holdings exercises other equity options, the Qatari stake in the miner would rise to 30 per cent.

Sky News quoted one person described as close to the European Goldfields transaction saying that, although the deal has been presented as the Qataris assisting Greece at a moment of economic need, "this isn't an act of charity". After a five-year wait, European Goldfields was given approval by the Greek environment ministry to dig three mines in the north-east of the country in July. That licence is set to turn the firm into Europe's largest gold producer.

In August, a Qatari fund agreed to provide funding for a merger of two of Greece's largest banks. The move will give the emirate a 17 percent stake in the lender that will be created by the merger of Alpha Bank and Eurobank.

The Qataris are also reported to be interested in buying other Greek state assets, including the former Athens airport at Hellenikon. Greece has come under intense pressure from its eurozone partners and the International Monetary Fund to step up its privatisation programme. And Greece is not the only European country looking for assistance from wealthy emerging nations. Last month, Italy's finance minister, Giulio Tremonti, held talks with China's sovereign-wealth fund about the possibility of Beijing buying large amounts of Italian bonds.

There is also speculation that BRIC countries – Brazil, Russia, India and China – might buy debt that is issued by the eurozone bailout fund, the European Financial Stability Facility.

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