BEIJING – Chinese fund manager Citic Capital Holdings said Wednesday that Qatar Holding LLC, an indirect subsidiary of Qatar Investment Authority (QIA), has bought over a fifth of the firm as the entity owned by the Qatari sovereign wealth fund ramps up its exposure to China. In a statement, state-backed Citic Capital said Qatar Holding, the fund that has been buying shares in miner Xstrata recently, bought a 22.22 percent stake by purchasing new shares. After the share enlargement, Citic Pacific Ltd. and Citic International Financial Holdings, both part of conglomerate Citic Group, will jointly have 42.78 percent in Citic Capital, while sovereign wealth fund China Investment Corp. will have 31.11 percent. Citic Capital manages more than $4.4 billion in assets from international investors, according to the statement, investing in private equity, structured finance and asset management. Qatar Holding has a stake in one of China's biggest banks, Agricultural Bank of China Ltd., after subscribing to $2.8 billion worth of shares in the bank's 2010 initial public offering. As of end-2011, Qatar Holding had a 22.18 percent position in AgBank's Hong Kong-listed shares, representing 2.1 percent of the Chinese bank's total issued shares, according to AgBank's annual report. Qatar Holding also has an 11.95 percent stake in Xstrata and is pushing for better terms in the miner's merger with Swiss commodities trader Glencore International plc. By investing in Citic Capital, Qatar Holding will increase its exposure to a number of sectors in the Chinese economy. For example, Citic Capital said earlier this year it is looking to make heavy investments in Chinese residential and retail property, targeting returns of 15 percent to 18 percent. Citic Capital is also a strategic investor in state-owned China Cinda Asset Management Co., which is preparing for an initial public offering. Cinda is one of four asset management companies that Beijing set up more than a decade ago to clean up the balance sheets of its major state-owned banks. The Chinese funds group is also part of a consortium of investors in US-listed Focus Media Holding Ltd. that has announced plans to take the company private in a $3.7 billion deal early this month. The financial terms of the deal or the size of the share enlargement weren't disclosed. QIA, which controls Qatar Holding, has been one of the world's most active sovereign-wealth investors in recent years, taking stakes in Porsche AG, Barclays plc and the company that operates Heathrow Airport. – Agencies
