x Abu Dhabi, UAEFriday 21 July 2017

End of an era as Jackson quits as chief of Istithmar

David Jackson, the chief executive of Istithmar World who oversaw the investment firm's most lavish purchases, has resigned as the company switches focus to managing existing assets.

David Jackson, the chief executive of Istithmar World who oversaw the investment firm's most lavish purchases, has resigned as the company switches focus to managing existing assets. Mr Jackson, a former Wall Street banker, was one of Dubai World's biggest hirings, helping to raise the profile of the government-owned conglomerate's private equity arm with investments including a US$942.3 million (Dh3.46 billion) purchase of the luxury US retailer Barneys New York, and the Queen Elizabeth 2 cruise ship.

Andy Watson, Istithmar's chief investment officer, has been appointed the acting chief executive, effective immediately. Mr Watson was a director with Barclays Capital, the investment banking division of Barclays Bank. "His experience will be vital in actively managing the portfolio of assets held by Istithmar World," said Aidan Birkett, the chief restructuring officer of Istithmar's parent company, Dubai World, which is in the process of refinancing $22bn of debt.

Mr Jackson's departure marks the end of an era for the investment house, after it was stung by a sharp decline in the value of its assets when the global financial crisis hit. "Today, Istithmar World is focused on the steady state management of existing assets to maximise value, rather than on private equity investment," Mr Birkett said. Mr Jackson's exit follows the resignation of two of Istithmar's investment officers, John Amato and Felix Herlihy, in September.

At that time, Mr Jackson received the backing of Dubai World after speculation about his future followed claims that the company was halting investments. He spent seven years at the company, serving as the first chief investment officer between 2003 and 2006, when he became the chief executive. Before that he lived in New York for a decade where he worked at several Wall Street investment banks, including Lehman Brothers, which collapsed in September 2008.

Under his leadership, Istithmar bought the QE2 cruise liner for $100m in June 2007, the same year it bought Barneys New York. At the height of the company's spending spree, Mr Jackson, a graduate of Yale and Princeton universities, was honoured in high-profile industry awards from the international press. He was picked in 2008 by the The New York Observer as one of the most powerful people in the city's property sector because of the number of major acquisitions he had made on behalf of Istithmar.

But some of the investments made under his stewardship have since run into difficulties. The future of the QE2 appears uncertain more than a year after it cruised into Dubai from the UK to become a floating hotel as part of plans by Nakheel, another Dubai World subsidiary. In August, Istithmar hired an advisory firm to help it come up with options to shore up Barneys financial position. In November, it sold two buildings in London's West End for a fraction of what it paid for them two years before as it sought to raise cash and trim costs, and last month the W New York Union Square hotel was sold at a foreclosure auction for $2m.

Other Istithmar stakes include the Yacht Haven Grande, a marina complex in the Caribbean, and the hedge fund GLG Partners. It also owns stakes in Dubai Aerospace Enterprise, the executive jet firm Daallo Airlines and Standard Chartered and Arcapita banks. @Email:tarnold@thenational.ae