Saudi Arabian sovereign wealth fund acquired at least $ 7.7 billion in top US and European companies in first three months of the year aggressively priced assets during the coronavirus pandemic.
The largest investments of the Public Investment Fund, which is chaired by Crown Prince Mohammed bin Salman, include a stake in the main British energy company BP worth $ 827.8 million, and a stake in Boeing, valued at 713 , $ 6 million in late March, according to an American source. regulatory filing.
The fund also acquired shares in Facebook, Bank of America, Citigroup, Walt Disney, Marriott, Pfizer and Starbucks, according to the file. Some of the new holdings, notably in cruise ship Carnival and concert promoter Live Nation, had been made public in recent weeks due to the size of the stakes.
At the end of last year, the only titles to be released from the sovereign wealth fund were his long-standing investment in the carpool group Uber and the remains of a Tesla bet by Elon Musk, whom he left first. trimester.
PIF Governor Yasir Rumayyan said last month that the $ 325 billion fund was actively seeking opportunities as the Covid-19 pandemic plunged global asset prices and left companies desperately looking for cash.
The PIF has made foreign investments as Saudi Arabia faces its worst economic crisis in decades, the kingdom being hit by the two Covid-19 shocks and the collapse in oil prices.
A senior Saudi official told the Financial Times last month that the kingdom has set up a dedicated team to examine “the medium and long term, the downsides and the benefits” of the global crisis.
Other sovereign wealth funds in the oil-rich Gulf, including Mubadala in Abu Dhabi and the Qatar Investment Authority, are also looking for investment opportunities, but the FIP has been the most active.
The PIF has been transformed since Prince Mohammed, de facto leader of Saudi Arabia, took over the presidency of the fund in 2015. He identified it as the main vehicle for carrying out his ambitious plans to diversify the economy of the oil-dependent kingdom and conservative modernization. Kingdom.
The PIF was responsible for overseeing national megaprojects and developing new industries in the kingdom, while increasing its exposure abroad.
A person familiar with PIF trades said there was a wave of activity in March, “when the fund managers capitulated.” He added, “They worked quickly. “
PIF bought shares in BP – which recently hit a 24-year low – Royal Dutch Shell and Total, among other oil companies affected by the collapse in energy prices caused by the coronavirus pandemic .
The purchases took place during a period when the price of oil fell as the industry was hit by the collapse of global demand and a price war that broke out between Saudi Arabia and Russia.
Riyadh struck a deal in April with global producers to achieve record production cuts of 9.7 million barrels per day as part of joint efforts to stabilize crude prices, which have fallen by more than half since January.
A person knowledgeable about PIF transactions said the kingdom was optimistic about the recovery in oil prices and the global economy and was looking to invest in stocks – such as industrial and energy companies – where they could best generate yields.
“It is a combination of portfolios and strategic operations,” he said.