Qatar Holding, a subsidiary of the country’s sovereign wealth fund, is buying a 20% stake in BAA, which operates several airports in the UK and Scotland.

Qatar Holding confirmed that it has agreed terms with Ferrovial and other existing investors for the sale and purchase of a 20% indirect shareholding in BAA. The transaction is conditional upon approval of European Union competition authorities.

The Spanish company said that it would sell part of its stake in the holding company that owns British airport operator BAA to Qatar Holding for about 607mn euros, according to a Reuters report.

A consortium formed by Ferrovial, FGP Topco, had in 2006 acquired BAA, which operates Heathrow and Stansted airports in London, Glasgow and Aberdeen airports in Scotland, as well as Southampton airport in southern England.

The agreed terms will see Qatar Holding enter the owners’ consortium with 20% shareholding and commensurate reductions in the shareholdings of Ferrovial and other investors who participate in this transaction.

Ferrovial said that after the sale of 10.6% of FGP Topco, it would retain a 39.37% holding in BAA.

Qatar Holding, which recently upped its stake in the UK miner Xstrata, maintains its view that Britain remains an attractive investment destination and there is long-term fundamental strength in the British economy.

“This acquisition is a key element in our exposure to the infrastructure sector and helps to further diversify Qatar Holding global investment portfolio,” its spokesman said.

Qatar Holding looks forward to working together with fellow shareholders and the management team of BAA to enhance the company’s industry leadership and create sustainable value, he said.

Barclays acted as financial advisor to Qatar Holding on the transaction.
Qatar Holding invests across the sectors such as financials, industrials, retail, real estate, commodities and telecommunications.

Its financials portfolio includes Agricultural Bank of China, Barclays, Credit Suisse, London Stock Exchange, QNB and Qatar Exchange; retail (fahrenheit, J Sainsbury, Harrods and Pavillion); commodities (adecoagro and Hassad Food); industrials (Hotchtief, Iberdrola, Porsche, Volkswagen); real estate (Banyan Tree and Canary Wharf Group); telecom (Qatar Telecom, Lagardere and Turkuvaz).