Argentinian billionaire in Falklands bid

One of Argentina’s richest men is plotting an extraordinary bid to seize control of the Falkland Islands’ biggest landowner in what could provide a major test of Theresa May’s resolve on foreign takeovers.

Argentinian property billionaire Eduardo Elsztain, through his Dolphin Fund, revealed on Wednesday he was considering a bid for AIM-listed FIH Group, which is also the disputed territory’s biggest retailer and controls its transport network.

Elsztain is Argentina’s biggest property investor and jointly owns Banco Hipotecario, Argentina’s biggest mortgage lender, with the government.

Tensions between Argentina and the UK, which went to war over the islands in 1982, have eased since new president Mauricio Macri took office in 2015, but last year he reiterated Argentina’s claim on the Falklands, or Las Malvinas, as they are known in Argentina.

If Elsztain makes a formal offer, it will test the Prime Minister’s pledge to block foreign takeovers not in the national interest.

Former business secretary Sir Vince Cable said: “The grounds on which the Government can intervene in public interest are quite limited.

“But if it is a national security issue and some Argentines are trying to take over the islands by the back door, I would have thought that would be a very good case for intervention.”

Dr David Reader at the Centre for Competition Policy also said it could “raise national security concerns”, adding: “If shareholders agree to any forthcoming deal, it could mark an interesting test case in terms of the Government’s policy towards foreign takeovers going forward.”

Dolphin sent a letter to FIH asking for information to “evaluate making a cash offer, at a significant premium” to the recommended £37 million bid on the table from the multi-millionaire Rowland family, FIH’s largest shareholder.

Edmund Rowland, son of controversial Tory donor David Rowland, is executive chairman of FIH, formerly known as Falkland Islands Holdings.