The Turkish sovereign wealth fund announced, on Monday, the completion of the transfer of 10% of the Istanbul Stock Exchange to the Qatar Investment Authority.

A statement issued by the fund stated that the operation came according to an agreement concluded on November 26, between the Turkish sovereign wealth fund and the Qatar Investment Authority.

He explained that the operation resulted in an investment by the Qatar Investment Authority of $ 200 million, noting that the price of the deal was determined based on the total capital value of the Istanbul Stock Exchange, which is about two billion dollars.

With the completion of the transfer of 10% shares, the Turkish sovereign wealth fund maintained its position as the largest shareholder in the Istanbul Stock Exchange with an 80.6% share.

The executive director of the Turkish sovereign wealth fund, Zafar Sonmez, was quoted as saying that the transfer of 10% shares on the Istanbul Stock Exchange to the Qatar Investment Authority is the beginning of a long-term cooperation between the two wealth funds in the two countries.

He expressed his belief that this investment will contribute to developing the principles of corporate governance before the public offering of the Istanbul Stock Exchange in the medium term.

 Of particular importance

Sunmez pointed out that Qatari investment is of particular importance in terms of attracting foreign capital to Turkey, in a period when global economies are facing challenges in light of the Corona pandemic.

He added that the investment of the Qatar Investment Authority in the Istanbul Stock Exchange proves its confidence in this stock exchange and Turkey's vision, noting that the Istanbul Stock Exchange will be one of the important actors in the Istanbul Financial Center, which is scheduled to start its effectiveness in 2022.

And last Thursday, a memorandum of understanding was signed to transfer 10% of the shares of the Istanbul Stock Exchange to the Qatar Investment Authority in the capital, Ankara.

The memorandum of understanding was signed by Sonmez and his counterpart from the Qatar Investment Authority, Mansour bin Ibrahim Al Mahmoud, at a ceremony held at the Presidential Complex in the capital, Ankara.

The statement indicated that the memorandum of understanding includes future cooperation between the Turkish and Qatari institutions for the governance of the Istanbul Stock Exchange.

The Turkish sovereign wealth fund is currently the owner of the largest share in the Istanbul Stock Exchange at 90.6%, before the percentage dropped to 80.6%, after 10% was transferred to the Qatar Investment Authority.

The Istanbul Commercial Stock Exchange acquires 2.27% of the shares of the Istanbul Stock Exchange, while 1.3% went to the Turkish Capital Markets Association, and 5.83% is distributed among other investors.

The deal for both funds is an indication of the mutual confidence in the potential and future of the Istanbul Stock Exchange.

Confidence index

On Monday, Turkish President Recep Tayyip Erdogan said the recent Qatari investments are an indication of confidence in his country's economy.

This came in response to opposition criticism of the Qatar Investment Authority's acquisition of 10% of the Istanbul Stock Exchange.

Erdogan added - in a televised address after the weekly cabinet meeting yesterday - that the opposition has no right to object to investments made by the Qatar Investment Authority in the Istanbul Stock Exchange.

He pointed out that the Qatar Investment Authority is an international institution with investments of more than $ 400 billion in more than 40 countries around the world, including Germany, Britain and the United States.

The Turkish President stated that the Qatar Investment Authority owns 10.3% of the London Stock Exchange.

Erdogan also indicated that Qatar is not the only country that invests directly in his country, noting that it ranks 17th among countries investing in Turkey, led by the Netherlands, the United States, the United Kingdom and other countries.

This deal is one of 10 agreements signed within the titles of the strategic partnership between Ankara and Doha, during the visit of the Emir of the State of Qatar, Sheikh Tamim bin Hamad Al Thani, to Turkey last Thursday and his meeting with President Erdogan.