(Yicai) Dec. 11 -- Shares in Kingdee International Software Group surged as much as 10.5 percent today after the Chinese office software developer said the Qatar Investment Authority is paying USD200 million for a stake in the firm, opening up the door for Kingdee to tap the burgeoning Middle Eastern market.

Kingdee’s share price [HKG:0268] was trading up 7.7 percent at HKD11.18 (USD1.40) as of 3.15 p.m. today. Earlier in the day it hit HKD11.48.

Unit Al-Rayyan Holding is buying 4.26 percent equity, or 155 million new shares, in Kingdee at a price of HKD10.10 (USD1.29) per share, about 2.7 percent lower than its closing price on Friday, Shenzhen-based Kingdee said. This is the largest single investment by a Middle East sovereign fund in China's software sector and in a Hong Kong-listed company since 2019.

"The Qatar sovereign fund, which is the ninth biggest sovereign fund in the world with nearly USD500 million of assets under management, has long tracked the development of China's software industry and is highly optimistic about the future development of Kingdee’s subscription business," a company executive told investors yesterday.

“The Qatar Investment Authority will provide resources for Kingdee's overseas expansion, helping it go global and enter the Middle Eastern market," Shanghai Securities News reported today. The Middle East, which has one of the fastest growing digital economies in the world, will now become a focus of Kingdee’s globalization strategy, it added.

Investment in information technology infrastructure by six countries in the region, namely the United Arab Emirates, Oman, Kuwait, Saudi Arabia, Bahrain and Qatar, is expected to exceed USD70 billion next year, the report said.

Editor: Kim Taylor