QATAR’S wealth fund is offloading almost half of its shares in Barclays, a surprise move that comes as the bank’s executives ready a strategic overhaul for early next year.

Qatar Holding, which is owned by the Qatar Investment Authority (QIA), is selling 361.7 million shares in the British firm, according to terms of the offering seen by Bloomberg News. The sale is expected to raise £510 million (S$862 million).

The Middle East state invested about £4 billion in Barclays during a series of sales in the 2008 global financial crisis, becoming one of its largest backers. It had a 5 per cent stake at the end of 2022, according to a US regulatory filing in January. Monday’s (Dec 4) accelerated book-build reflects about 45 per cent of that position.

“The timing is slightly odd, and it’s hardly a ringing endorsement ahead of the investor update,” said Adam Terelak, an analyst at Mediobanca.

A Barclays spokesperson declined to comment. A representative for the QIA did not immediately respond to a request for comment.

Barclays shares

Barclays’ shares have fallen by a tenth this year to Monday, underperforming many of its peers. This comes as executives work on ways to boost returns that are set to include job cuts. In the UK, the tailwind from higher interest rates is slowing, while Barclays’ traders and investment bankers have struggled to keep pace with US peers.

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The group comprises one of the UK’s largest retail banks, as well as an international credit card business and a global investment bank. But investors have been wary of its capital markets ambitions. It trades at a paltry price-to-book ratio of 0.39, lagging rivals.

Earlier this year, chief executive officer CS Venkatakrishnan tapped Boston Consulting Group to do a wide-ranging review of the firm’s strategy, with executives expected to unveil a series of more ambitious financial targets in February.

A range of options is being considered, from expanding the advisory business to acquiring a wealth manager, sources familiar with the matter have said.

The shares were expected to price at £1.41, representing a 1.4 per cent discount to Monday’s close. Shares of Barclays fell as much as 4.5 per cent on Tuesday, exceeding the expected discount.

The discount offered was smaller than is typical for such overnight offerings. Block trades that raised at least US$150 million have priced on average 4.7 per cent lower than the close so far this quarter, according to data compiled by Bloomberg News.

The offering represents about 2.4 per cent of Barclays’ outstanding shares, according to the terms.

Bailout fallout

While Qatar’s 2008 intervention helped Barclays avoid a government bailout, the emergency fundraising has been a legal headache since.

Last year, the Financial Conduct Authority said it planned to fine Barclays £50 million for failing to disclose an agreement to pay advisory fees to Qatari investment vehicles during the fundraising efforts. The bank has said it plans to challenge the regulator’s proposal.

Former executives at Barclays were cleared of fraud in connection with the transactions in 2020. BLOOMBERG