Arabs start seeing where the value lies: Abu Dhabi fund buys into Banco Santander Brasil.
This is a move away from sending their money to Europe.
After decades of buying hotels, department stores, pieces of German carmakers,European football clubs they see with the right place to put thir money is.
Abu Dhabi fund buys into Banco Santander Brasil
By ADAM SCHRECK (AP) – 1 day ago
DUBAI, United Arab Emirates — The Abu Dhabi investment fund with the biggest stake in Mercedes-Benz said Sunday it has spent $328 million for a piece of a Brazilian bank recently floated by Spanish financial giant Banco Santander.
Aabar Investments' deal — the latest in a string of big bets by the fund this year — is another sign that Gulf governments are regaining their appetite for fresh investments and have plenty of cash left to spend despite the economic downturn.
It comes one day after Qatar's sovereign wealth fund said it boosted its stake in the company that owns much of London's Canary Wharf, a business district that houses offices for many of the world's best-known banks.
"We are delighted to have had the opportunity to invest in such a strong and successful entity," Aabar's chairman, Khadem al-Qubaisi, said in a brief statement announcing the Brazil deal.
"We hope to continue to strengthen and develop the existing relationship we have with Banco Santander and look forward to working with them in the future," he said.
Aabar has been among Abu Dhabi's most active investment funds in recent months, buying a 9.1 percent stake in Mercedes-Benz maker Daimler and nearly a third of commercial space travel startup Virgin Galactic.
It also owns 4 percent of San Carlos, California-based electric car producer Tesla Motors.
The Abu Dhabi government controls Aabar through a majority stake owned by its state-run International Petroleum Investment Co.
Abu Dhabi is the largest and richest of seven sheikdoms that make up the United Arab Emirates, and serves as the federation's capital. It controls nearly all of the OPEC member's conventional oil reserves, the world's fifth largest.
Its buy-in follows Banco Santander Brasil's $8.1 billion initial public offering last week.
Parent company Banco Santander SA initiated the IPO — the largest this year — in an effort to expand its Latin American operations.
It hopes to take advantage of one of the world's fastest growing economies by opening new branches and ATMs, and providing credit through its commercial banking and global wholesale banking divisions.
Santander is Brazil's third largest private sector bank behind Itau-Unibanco and Bradesco.
Aabar's purchase is the second major deal announced by Gulf state-backed investors in as many days.
On Saturday, Qatar Holding said it increased its holding in Songbird Estates PLC to 24 percent, making it the biggest shareholder in the real estate company that owns much of the Canary Wharf financial hub in east London.
Qatar Holding is the investment arm of the natural gas-rich Arab state's sovereign wealth fund.
It said its investment in Songbird now stands at more than 350 million pounds, or $559 million. It also owns stakes in European banks Barclays PLC and Credit Suisse Group, British supermarket operator J Sainsbury PLC and the London Stock Exchange.
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