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Abu Dhabi, UAEFriday 14 December 2018

Prince Alwaleed targets new deals for Kingdom Holding 

Saudi Arabia's Prince Alwaleed bin Talal, just weeks after his release from detention in Riyadh’s Ritz-Carlton, is looking for deals again and planning to reshape his investment empire.

The prince, in his first interview since leaving the hotel seven weeks ago, told Bloomberg Television he is working with advisers including Goldman Sachs to find investments as large as $3 billion for Kingdom Holding, his publicly traded investment firm. He also said he is likely to split the company’s $13bn of assets through a spin-off of its domestic property and other holdings.

“It will take some time as we are still developing that matter,” the 63-year-old nephew of King Salman said at his Riyadh apartment. “Our CEO is thinking in these terms.”

Prince Alwaleed was the most prominent among hundreds of Saudi businessmen, government officials and princes who were swept up in November in what the government called a crackdown on corruption. Ranked the world’s 64th richest man and long the public face of the Saudi royal family to foreign executives and investors, Prince Alwaleed made clear he wants to reassure partners that his business empire is intact and fully functioning after 83 days of confinement in the Ritz-Carlton.

“I understand it’s not going to be easy at all - some people in business community will be doubtful, will say, ‘What’s going on?,’” Prince Alwaleed said. “However, I assure them that everything is normal and we are functioning as we were before and we welcome them to come here to see what we’re doing in Saudi Arabia and life is back to normal.”

While the prince refused to provide the terms of his release, he described a “confirmed understanding” with Saudi authorities. Signing the document left him free to function normally with "zero guilt" and "zero conditions".

Prince Alwaleed gained international fame in the 1990s as a savvy investor and occasionally drew comparisons to Warren Buffett. Kingdom Holding’s current investments include stakes in Citigroup, Four Seasons Hotels & Resorts and Twitter.

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Its domestic holdings, most notably a kilometre-high tower under construction in the Red Sea city of Jeddah, make up about half of Kingdom Holding’s assets. Prince Alwaleed said they could be spun off into a real estate investment trust.

In the meantime, Kingdom Holding is seeking to raise $1bn to $2bn in debt. Prince Alwaleed descried that as “firepower” for local, regional or international investments of $1bn to $3bn.

“Right now we are in discussions with certain companies in the US for certain deals,” the prince said. “Although the market right now in the US is - I’d not say overvalued - but prices are not where we would wish them to be.”

Kingdom Holding shares, which trade on Saudi Arabia’s Tadawul exchange, have slumped 12 per cent since Prince Alwaleed’s November 4 detention, giving the company a market capitalisation of about $9bn. The prince holds a 95 per cent stake.

Graphic by Roy Cooper / The National
Graphic by Roy Cooper / The National

Saudi Arabia freed Prince Alwaleed and several of the country’s prominent businessmen from detention in late January, clearing out the Ritz-Carlton hotel that served as a holding pen during the crackdown.

In part because the government never confirmed the names of those detained or revealed the charges or evidence against them, the round-up raised concerns among foreign investors about due process and transparency in the Saudi legal system. Prince Alwaleed denied that detainees were treated badly during their time in the Ritz-Carlton.

“Actually, I was given the best service," he said. "Doctors used to come twice a day. We had the best service, best food, best everything.”

Like Prince Alwaleed, many of those who were released are returning to their lives and business as normal. Former finance minister and minister of state Ibrahim Al Assaf led Saudi Arabia’s delegation to the World Economic Forum in Davos, Switzerland in January.

“It’s business as usual,” Prince Alwaleed said. “We are going to continue investing in Saudi Arabia. I was born in Saudi Arabia, I will die in Saudi Arabia.”