(Bloomberg) -- Qatar announced on Thursday a series of high-profile investments in Turkey, its biggest ally in a years-long rift with Gulf heavyweights Saudi Arabia and the United Arab Emirates, including the purchase of a stake in the country's main bourse.
Doha-based sovereign wealth fund Qatar Investment Authority signed a memorandum of understanding with its Turkish counterpart known as TWF to purchase a 10% stake in Borsa Istanbul AS.
The agreement for a minority stake in the company that runs the main Turkish stock exchange, for an undisclosed amount, was unveiled at a ceremony at the presidential palace in Turkey's capital Ankara. It was overseen by Turkish President Recep Tayyip Erdogan and Qatari Emir Sheikh Tamim bin Hamad Al Thani.
The Gulf state also signed another preliminary deal to invest in a multibillion dollar port project in Istanbul and finalized an earlier agreement to buy a stake in Istinye Park, one of Istanbul's largest shopping malls that's popular among tourists from the Middle East.
Salt Bae Owner's Qatari Deal Is Said to Value Mall at $1 Billion
The deals and the fanfare surrounding their signing highlight the growing alliance between the two countries since a coup attempt against Erdogan in 2016. The Turkish leader received backing from the Gulf nation's rulers after the failed putsch and returned the favor a year later by siding with Qatar when it came under an economic boycott from a group of countries led by Saudi Arabia and the UAE.
Meanwhile, Turkey has stationed troops and steadily built up a base in Qatar since 2017.
Qatar, a major Gulf gas producer, has since then pledged as much as $15 billion of investment and offered a credit line to backstop Turkey's financial system at the height of its currency crisis in 2018. Turkish and Qatari central banks tripled the limit of their existing swap deal this year.
Borsa Istanbul
The agreement on Borsa Istanbul, if finalized, would reduce the Turkish sovereign wealth fund's stake in the company to to 80.6%. The stake sale comes around a year after TWF purchased EBRD's 10% stake in the bourse.
The EBRD decision to exit Borsa Istanbul came after Turkey appointed Hakan Atilla as chief executive officer. Atilla served a prison sentence of 28 months in New York for an alleged role in breaching U.S. sanctions on Iran when he was a deputy chief executive at a state lender.
Since 2015, Borsa Istanbul has been postponing its decision to go public as it waited for a favorable time to get better value. Atilla said in February that the company would be ready for an initial public offering at the end of this year.
©2020 Bloomberg L.P.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
