Saudi Arabian sovereign fund buys stake in Carnival

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  • The Saudi Arabian sovereign wealth fund has just collected 8.2% of Carnival Corporation, the cruise line with more than 100 ships.
  • Carnival’s shares have fallen 80% in the past year, and the company said last week that it would lose money this year – but it is not yet known how much.
  • The carnival raised billions from debt and equity offers last week as it seeks to stay afloat while business stops amidst coronavirus.
  • Visit the Business Insider home page for more stories.

Carnival Corp. shares have plunged more than 80% in the past year, leading a major investor to seize an opportunity.

Saudi Arabian sovereign fund Public Investment Fund bought 8.2% of the shares in the cruise ship giant, according to a file released on Monday. Carnival stocks jumped on the news, with stocks up 23% in Monday noon trading.

PIF manages more than $ 300 billion and has invested in companies ranging from Uber to Tesla.

Saudi Arabia’s financial influence on public and private markets has been under close scrutiny since the assassination of Jamal Khashoggi in October 2018. The CIA has blamed the murder of the journalist on Saudi Crown Prince Mohammed bin Salman , who chairs the PIF.

A Carnival spokesperson declined to comment on the news.

PIF was not the only recent buyer of Carnival: Business Insider reported last week that an anonymous director of Carnival bought $ 10 million worth of shares in the most recent offer.

Carnival said on Friday that he would lose money this year but did not know how much. The coronavirus has already hit the bottom line of the cruise giant hard. It lost $ 781 million in the three months ending February 29, compared to $ 336 million in the same period last year. The carnival ceased operations on March 13 and still has 6,000 passengers worldwide expected to land by the end of April.

Analysts told Business Insider last week that while the industry is in trouble, public cruise lines could pay the bills for six to nine months.

“Cruise lines, as evidenced by the actions, are currently in a world of suffering with no bright lights at the end of the tunnel,” said Patrick Scholes, analyst at SunTrust Robinson Humphrey.

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