Detained Saudi Prince Has Backed U.S. Companies
Prince al-Waleed gained prominence after buying shares of Citigroup predecessor
By Anupreeta Das
Updated Nov. 5, 2017 9:43 p.m. ET
NEW YORK—The arrest this weekend of billionaire tycoon Prince al-Waleed bin Talal hobbles an investor who has straddled east and west, backing some of the world’s best-known companies while also encouraging U.S. business to invest in the Middle East.
The Saudi Arabian prince was among dozens of people who were arrested as part of a crackdown on corruption in the kingdom, as King Salman and his son Crown Prince Mohammed bin Salman move to consolidate power. Prince al-Waleed hasn’t been charged, but could face allegations of money laundering and illegal arms sales, people familiar with the matter said.
Representatives for Prince al-Waleed and his investment company, Kingdom Holding Co., didn’t respond to requests for comment. On Sunday, shares of Kingdom, which trade on the Saudi stock exchange, fell 7.6%.
In a statement posted on the Saudi stock exchange’s website on Sunday, Kingdom Holding’s chief executive said the company has received the support of the government and would continue to operate “business as usual.”
Prince al-Waleed has been a familiar figure in Western business and financial circles for more than a quarter of a century, having backed iconic U.S. companies such as General Motors Co. , Apple Inc. and Citigroup Inc. More recently, the prince has invested heavily in young technology companies including Twitter Inc. and Lyft Inc.
One of the prince’s most high-profile partnerships is with Microsoft Corp. co-founder Bill Gates. The investment firms of the two billionaires teamed up a decade ago to take luxury hotel operator Four Seasons Holdings Inc. private for $3.8 billion.
Four Seasons spokeswoman Sarah Tuite said it was “business as usual” and that the “matter does not affect the day to day operations of Four Seasons Hotels and Resorts.”
Educated in the U.S., Prince al-Waleed is a regular presence on American business television, weighing in on his investments, the global economy and U.S. politics. In October, he appeared on CNBC for an extended interview from Riyadh, discussing everything from bitcoin to the planned initial public offering of Saudi Aramco, Saudi Arabia’s national oil company.
“It just doesn’t make sense,” he said of bitcoin, adding that it was “going to implode one day.” He also said he supported Saudi Arabia’s move to diversify away from its dependence on oil, and he endorsed the country’s turnaround plan, remarking that Saudi Arabia was on the cusp of revolutionary financial, economic, social and political change.
“This is our version of…[peaceful] Arab Spring,” he said.
The image of King Salman and Crown Prince Mohammed bin Salman were projected on Kingdom Tower in Saudi Arabia during National Day ceremonies in Riyadh in September.
The image of King Salman and Crown Prince Mohammed bin Salman were projected on Kingdom Tower in Saudi Arabia during National Day ceremonies in Riyadh in September. Photo: Saudi Culture and Information Ministry /Associated Press
The prince shot to prominence in the U.S. in 1991 after buying shares of a predecessor to Citigroup. The deal eventually made him one of the bank’s largest individual shareholders. He remained a major backer of Citi as the firm’s shares plunged in value during the 2008 financial crisis and participated in an international capital raise by the bank during that time.
In March, Prince al-Waleed hosted a dinner for Citigroup chief executive Michael Corbat in the Saudi capital, where they discussed “future plans of the company,” according to Kingdom’s website. One month later, the bank received approval from Saudi Arabia’s regulator to operate a capital-markets business in the kingdom after a long absence.
The prince’s desert tent in Riyadh is a regular stop for U.S. company executives, investors and foreign dignitaries. Many of these events are documented on Kingdom’s website.
Last month, Goldman Sachs Group Inc. chief executive Lloyd Blankfein and other senior bank executives met Prince al-Waleed in Riyadh, according to the website. Goldman advised Kingdom on its deal to acquire a stake in Banque Saudi Fransi from Credit Agricole SA .
In 2015, executives from Snap Inc. including CEO Evan Spiegel met with the prince about “future potential business cooperation” while the disappearing-message app company was in the midst of a funding round. However, Kingdom never invested in Snap as a private company and didn’t purchase shares in its public offering, according to a person familiar with the matter.
The prince has also been a longtime investor in Rupert Murdoch’s media empire, first investing in News Corp in 1997 and eventually becoming the second-largest holder of voting shares outside of the Murdoch family.
He remained a supporter of Mr. Murdoch’s, even as News Corp. became embroiled in a phone hacking scandal in London and was subsequently split into two companies—News Corp and 21st Century Fox —in 2013. Two years later, he sold the bulk of his stake in News Corp, which owns The Wall Street Journal. He is also no longer a major shareholder in Fox.
In 2010, News Corp paid $70 million for a stake in Rotana Group, a Middle Eastern entertainment company primarily owned by Prince al-Waleed’s firm. Since the split, Fox has continued to own a small stake in Rotana.
That year, the prince bought a $500 million stake in GM during the carmaker’s initial public offering.
—Keach Hagey, Margherita Stancati and Maureen Farrell contributed to this article.