Dubai & Qatar to set up $1bn company

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Dubai, The governments of Dubai and Qatar, which have bought into large European companies this year, said they agreed to set up a firm to buy shares in global markets and build a long-term investment portfolio.

The official Qatar News Agency reported late on Tuesday the Qatar Investment Authority had signed the deal on the government's behalf.

QIA was interested in buying up to 10 percent of EADS , parent of European planemaker Airbus, Qatar's foreign minister said in March.

State controlled Dubai International Capital confirmed last month it was in talks with the management of EADS about buying a stake for a fund it manages.

The new Qatar-Dubai company will have a capital of 1 billion dollar(3.7 billion dirhams), according to WAM, state news agency of the United Arab Emirates, which includes Dubai.

The company will "target distinguished investment opportunities in the Middle East and North Africa," said UAE state minister for cabinet affairs Mohammed Al Gergawi following the signing of the agreement in Dubai.

"There are strong and common economic and human factors between the two states, which qualify them to establish a huge investment portfolio for joint investments in the private sector, as well as in long-term investments and acquisitions of shares in large companies listed in international stock markets," he said.

The agreement was signed during a visit to Dubai by Qatari Prime Minister Sheikh Hamad Bin Jassem Bin Jabr Al Thani.

Government-controlled companies in Dubai have been scouring the globe for assets for years. Their acquisitions this year include stakes in HSBC Holdings and Deutsche Bank .

Investments this year by Qatar, which has the world's third largest natural gas reserves, include a stake in retailer J. Sainsbury .

The company will also target investments in the Middle East and North Africa, WAM said.

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