PIF’s sprawling business interests
PARIS: Saudi Arabia’s global investment reach is impressive, stretching from stakes in Twitter and Uber to AccorHotels and Virgin Galactic — but the Khashoggi affair has thrown a harsh spotlight on its economic footprint.
The following is a synopsis of the kingdom’s investment portfolio.
A United Nations report last year showed Riyadh ploughing US$1.43 billion (RM5.97 billion) into direct foreign investment, including US$380.8 billion in “developing nations”.
The state’s sovereign wealth Public Investment Fund (PIF) nest egg accounts for the biggest share of the total, US$250 billion as of last month, both at home and abroad. The government wants to lift that to US$400 billion by 2020.
Around half of PIF’s holdings concern domestic activities and the fund’s chairman Crown Prince Mohammed Salman is above all pushing investment in new technologies.
The PIF recently took a share in the capital of several leading United States firms, including a US$3.5 billion stake in global ride-sharing giant Uber, as well as US$400 million in virtual reality start-up Magic Leap.
The fund contributes to the financing of innovative projects such as the Lucid Motors selfdriving car or Virgin Galactic space tourism missions, with a cool billlion going to both.
The sovereign fund has also joined together with Japanese conglomerate Softbank and a clutch of other investors to create the ambitious high tech Vision Fund, the Saudi contribution US$45 billion to a US$100 billion scheme.
It also participates in a consortium which holds a 65 per cent share in AccorInvest, the parent company of French hotel chain AccorHotels, and has a 20 per cent stake in iron and steel giant ArcelorMittal.
Prince Al-Waleed Talal, the chief executive officer of the Kingdom Holding Company (KHC), is also a key figure on the Saudi international investment scene.
Since 1991, he has invested US$590 million in Citicorp to obtain a 14.9 per cent stake, according to the New York Times.
Through his position with KHC, the prince has made huge investment in Saudi real estate as well as abroad in fields from digital infrastructure, hotelry and entertainment.
He maintains 4.61 per cent shareholding in Twitter, acquired in 2015, and has invested US$100 million in Lyft, Uber’s main rival, while injecting a further 25 millions into Snap, the parent of Snapchat.