Qatar eyes takeover of High Street giant M&S

Takeover speculation at Marks & Spencer (M&S) stepped up a gear this weekend with Qatar's sovereign wealth fund thought to be mulling a bid for the High Street giant worth eight billion pounds.

According to The Sunday Times, the Qatar Investment Authority is said to be assembling a consortium of private-equity investors and has spoken to banks about financing a potential offer.

Rumours over the buyout lifted the retailer's stock last week, with the share price finishing nearly 3.0% higher at 372.5p, leaving its market capitalisation just shy of £6.0bn.

The offer, if made, is thought to be for a price of 500p a share, valuing the company at £8.1bn.

The Qatar Investment Authority has already made a number of large investments in British retail, being a 26% stake-holder in supermarket group Sainsbury and the owner of high-end department store Harrods.

Speculation surrounding a potential bid for M&S had increased over the last few months after a series of disappointing trading updates. In the third quarter in particular, M&S missed sales forecasts for the key Christmas period with like-for-like sales in the UK dropping by 1.8%.

Since the start of 2013, the stock has failed to join in with the wider stock-market rally dropping 3.2%, underperforming the benchmark FTSE 100 which has jumped over 10%.

It is thought that if shares in M&S rise more than 5.0% on Monday morning on speculation of a bid, the company or any possible bidder would be under pressure to release a statement under Takeover Panel rules, according to The Times.