Barclays go to the Middle East for cash injection

Last night Barclays was close signing a £6 billion capital injection from the Middle Eastern governments, including those of Abu Dhabi and Qatar, this will allow Barclays to boost its balance sheet without having to go to the UK Government for cash.

Executives at Barclays last night were finalizing the terms of the capital increase with investors that included the Abu Dhabi-based sovereign wealth fund and Qatar Investment Authority.

It’s likely that an announcement could be made today, although the negotiations could go into the weekend or possibly fall apart according to people involved.

Barclays have also been in talks with Libya’s sovereign wealth fund which could also get involved with the fund raising, although last night’s talks hinted towards Libyan Investment Authority exiting from the proposal.

The UK bank has until the end of the year to raise £3 billion in preference shares, and until March to raise £3.5 billion in ordinary shares, if Barclays fail to complete any private deals they will be forced to take the UK government backing under a plan agreed with the Financial Services Authority (FSA). Barclays shares closed last night up 14.95p to 205.25p.

Source: FTimes