Mystery suitor for Sainsbury's
Sainsbury’s suitor and Qatari royal family-backed investment vehicle Delta Two has been thrust into the limelight by its interest in snapping up the supermarket giant, but until now little has been known of the seemingly deep-pocketed fund.
The mystery surrounding the firm and its links with the royal family of Qatar has raised questions in the UK, with intrigue surrounding the Middle Eastern country’s intentions for Sainsbury’s.
In the UK, Delta Two has a limited track record, having only launched last year.
The group’s name gives little away, but it is effectively a subsidiary of a fund controlled by the Qatar Investment Authority (QIA) – whose chief executive is Sheikh Hamad bin Jassim bin Jaber al Thani, the prime minister of Qatar and a member of the Qatari royal family.
Sheikh Hamad, cousin of the Emir of Qatar, was appointed prime minister just three months ago, having taken over from Sheikh Abdullah bin Khalifa al Thani, who resigned in April.
His investment fund Delta Two is advised by a London-based group called Three Delta, launched last year by chief executive Paul Taylor, former NatWest banker and most recently chief executive of Rotch Property Group, a firm headed by property tycoon Robert Tchenguiz.
The link with Mr Tchenguiz has raised eyebrows in the City, given that the Iranian billionaire is a major shareholder in Sainsbury’s.
Mr Tchenguiz has also been calling for the supermarket to spin-off its property portfolio and unlock value for shareholders, and is said to have been left disappointed by Sainsbury’s recent refusal to let go of its real estate.
Three Delta maintains that, despite Mr Taylor having worked with the entrepreneur, there is “no relationship whatsoever”.
The group is also keen to stress that it is not, as feared, merely a private equity investor in disguise.
Three Delta claims that the QIA’s financial backing allows it to have a “long-term investment horizon”, adding that its primary goal is to seek investments for the Gulf kingdom that are outside of its main trade – the oil and gas business.
“The Qatar Investment Authority’s main objective is to diversify away from fossil fuels and look at substantial cash-generative businesses with a strong management team,” according to a spokeswoman.
Sainsbury’s would be by far the largest European investment made to date by Delta Two.
The group’s £3bn (€4.5bn) portfolio so far includes the £150m (€223m) purchase last May of Senad – a private education group that specialises in teaching children with severe learning difficulties, and the £1.4bn (€2bn) takeover of Four Seasons Healthcare – Britain’s biggest nursing home company.
The group, which said it will set up an online presence “within the week”, reportedly already employs some 50,000 in the UK through its investments.
Aside from its figurehead, Mr Taylor, Three Delta remains tight-lipped on other senior figures involved in the business, although reports suggest that the group last year hired former Barclays boss Peter Middleton as chairman.
It is also thought that former Ernst and Young chairman Nick Land and Sir Christopher Howes, previous boss of the UK royal family’s property portfolio, the Crown Estate, are also directors.
