When Qatar stepped into the ring on Monday offering to buy shares in the German construction company Hochtief, it was not only acting as a white knight, but was pushing ahead with its own dream.
Qatar's sun is on its way up
There is no doubt that the Qatari offer to purchase a 9.1 percent stake in Hochtief is good news for the German company seeking to thwart a hostile takeover bid from Spanish rival Actividades de Construccion y Servicios (ACS).
Hochtief, which currently has five subsidiaries in Qatar and employs more than five thousand people in the country, is to sell its shares at 57.114 euros a piece, which is less than the current stock price, but around the same as ACS is offering.
The news of the deal between Qatar and Hochtief sent shares soaring, which as analysts were quick to point out, would make ACS's all-share offer considerably more expensive. The group, headed by Real Madrid soccer club president Florentino Perez, has yet to comment on the latest twist in the takeover drama in which Qatar shines as the white knight.
But there is nothing selfless about the oil-rich country's intervention. Quite the reverse in fact.
"This is Qatar's moment and it has been working towards it for the past ten years," Kristian Coates-Ulrichsen, Kuwait research fellow at the London School of Economics told Deutsche Welle. "It has been trying to diversify its name and create a brand 'Qatar' through the acquisition of high profile companies."
Among the country's corporate portfolio are stakes in the German sports car manufacturer Porsche, Europe's largest carmaker Volkswagen, and arguably the most prestigious department store in the world, Harrods. And that is to name but a few.
Harrods is one of Qatar's high-brand icons
"They have been getting powerful external economies to buy into the image so as to reposition themselves," Coates-Ulrichsen said. "They plan to diversify away from being a gas and oil-based economy."
And winning the bid for the 2022 soccer World Cup has helped them on their way. It means instant recognition and international acceptance of Qatar as a global force, and it also puts the country ahead of its regional competitors.
"Dubai and Abu Dhabi have been trying to do the same thing as Qatar, but the World Cup puts Qatar to the front of the queue and overshadows everything else," the economist added.
New infrastructure in the offing
The Gulf country's stock exchange responded well to the news of the successful soccer bid, and Taha Abdel Ghani, general manager of Nama Economic Consulting told the AFP news agency that it had "raised investors' confidence in the Qatari market."
A model of the Qatar University stadium for the the 2022 World Cup
"There are huge sums of money that Qatar has pledged to spend within a set period of time," he said.
Doubtless a lot of that money will go on infrastructure to make the first World Cup to be held in the Middle East a resounding success. There is already talk of a joint venture between Hochtief and Qatar to build an entirely new city, designed to house 200,000 people and play a hosting role in the soccer championships.
Hochtief CEO Herbert Luetkestratkoetter is optimistic that a construction boom is on the way.
"You need to be able to accommodate guests who come to the country," he told reporters. "It suits me just fine. I'm happy about it."
In that context, the decision to invest in the German construction company could be seen as highly strategic. It would certainly sit with the country's pattern of doing things. A couple of years ago Qatar invested in a shipyard in Poland which was building tankers to transport its gas.
There's much more to Qatar than the sand on which it is built
"It's all part of a broader plan to diversify and meet the needs of the Qatari economic strategy by investing in companies they can use," Coates-Ulrichsen said. "They match talent with economic niches."
And as far as he is concerned they do it exceptionally well. Rather than bothering with speculative investment like some other Gulf states, Qatar has a clear vision of how it wants to diversify, namely into iconic Western companies, construction and real estate.
This, the economist insists, will stand the country in great stead, opening not only economic, but political doors for what might once have been regarded as a small country in the middle of the desert.
Author: Tamsin Walker
Editor: Andrea Roensberg