Newspaper article The Evening Standard (London, England)

Sheikh's Barclays Reward: Some Credit Where It's Due

Newspaper article The Evening Standard (London, England)

Sheikh's Barclays Reward: Some Credit Where It's Due

Article excerpt

Byline: Nick Goodway

PHEW! The stench of sour grapes blended with xenophobia across the City this week was almost unbearable. Sheikh Mansour bin Zayed al-Nayhan made a tidy [pounds sterling]1.46 billion profit selling 1.3 billion shares in Barclays at 265p. He had effectively bought them for 153p just seven months ago.

"Foul," screamed some of the grey suits in the Square Mile. "He said he was a long-term investor," cried others. "We weren't offered the same chance to double our money," bemoaned yet others.

On the other side of Throgmorton Street, the boys in the chalk-striped suits countered with: "He's called the top of the market", "The banking rally is over" and "Told you it was a dead cat bounce in a bear market rally."

Total nonsense all of it.

Go back to Halloween Day last year, and put Barclays' position into context.

World money markets were frozen. The bank needed cash fast to shore up its balance sheet and could not afford to wait the weeks it would have taken to get a rights issue away.

On the bank's side, dealmaker extraordinaire Roger Jenkins tapped his depth of contacts in the Gulf ruling families and found Abu Dhabi and Qatar. On the Abu Dhabi side, Amanda Staveley, who had already helped Sheikh Mansour buy Manchester City Football Club, advised him the Barclays fund-raiser was a worthwhile gamble. He paid her [pounds sterling]40 million for the advice.

Intriguingly, I hear Staveley advised the Sheikh against selling this week because she reckoned Barclays' share price had further to go.

Now Sheikh Mansour knows a thing or two about taking risks. His fatherin-law is Sheikh Mohammed of Dubai, whose Godolphin operation has been largely responsible for the survival and success of the British flat racing industry over the past two decades.

Lest we forget Sheikh Mansour was staring at a paper loss of some [pounds sterling]1.3 billion on his [pounds sterling]2 billion of convertible notes when Barclays' shares hit their nadir of 51.2p in January. That suggests that the Sheikh (and his advisers) are considerably better at risk assessment than either the Financial Services Authority or Her Majesty's Treasury. …

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