BRIEFING BOOK Data Information Knowledge WISDOM PRINCE ALWALEED BIN TALAL Location: Forbes, New York, New York About Prince Alwaleed Bin Talal ...................................................... 2 Debriefing Bin Talal ............................................................... 3 Bin Talal in Forbes "Apple Can't Save Saudi Billionaire,” 07/21/09……………….. 6 "A Week With Prince Alwaleed," 03/27/09…………………….. 7 "I Just Can't Wait To Be King," 03/11/09 ……………………… 10 "Royal Treatment Can't Save Citi," 11/20/08 …….................... 15 The Bin Talal Interview ………………………………………….. 17 - 1 - ABOUT PRINCE ALWALEED BIN TALAL Intelligent Investing with Steve Forbes Prince Alwaleed Bin Talal Bin Abdul Aziz Alsaud is chairman of investment company, Kingdom Holding Company, which went public on the Saudi stock exchange in 2007. He is the 22 nd wealthiest person, according to the 2009 Forbes World's Billionaires list. Kingdom Holding contains his investments in companies such as Citigroup and News Corp., as well as Four Seasons Hotels and Fairmont Hotel management companies, among many others. Alwaleed joined the Singapore government investment arm and several other investors in a $12.5 billion capital injection for Citigroup in January 2008; the size of his investment is undisclosed. He is also an investor in mainstream technology companies like Apple Computers, Motorola and AOL. Though Alwaleed is a member of Saudi Arabia’s royal family, he has mostly stayed away from joining in politics, preferring to pour energy into his stock market and real estate ventures. He has been outspoken about his disapproval over traditionalist political moves, especially the treatment of women in Saudi Arabia. In 2004, he hired the first female airline pilot in Saudi Arabia. Alwaleed got his bachelor’s degree in business administration from Menlo College and a master's degree in social science from Syracuse University. He is currently married and has two children. - 2 - DEBRIEFING BIN TALAL Intelligent Investing with Steve Forbes Interview conducted by Alexandra Zendrian January 11, 2010 Forbes: How has Kingdom Holdings been doing lately and how do you anticipate it doing this year? Prince Alwaleed Bin Talal: I think 2009 was a tough year, but that's behind us. We are very optimistic about 2010 and thereafter. We are seeing all our subsidiaries and our affiliates beginning to seem more alive and seeing some growth. What is fueling that growth? What gives you a reason to be more optimistic about 2010? Well, you know, I'm talking basically about the Middle East. The Middle East, as you can understand, was not impacted as much as the United States and other areas were impacted. Really, the impact here was minimal. So we are beginning from a better point to begin with. And remember, the Gulf region is still very much oil based, and the price of oil is around $80, so we have all these tailwinds behind us. In your personal holdings, you have some media companies. How do you foresee those doing in the near future? One of my biggest personal holdings is Rotana. That company has a very dominant force in the Middle East. It has around 45% of all the movie industry and around 75% of all the music. And this is doing extremely well. It's growing around 14 to18% every year and has top, top revenues. What do you look for when you're making investments? When we look at investments, we look at the company to see if it has a global presence. We look at companies with an entry point that can achieve 20% growth within a five to 10 year time horizon. So, if you look at what's common among some of the companies I have, including the Four Seasons, NewsCorp, George V, the Plaza, these are all irreplaceable brands in their own fields. Kingdom Holdings is also invested in Citigroup. How do you see that doing this year? Citigroup also is a blue chip name. Unfortunately, in the past two years, it has faced tremendous difficulties; a lot of headwinds. We hope that under the leadership of Mr. - 3 - Vikram, and after paying the TARP, and after maybe taking some losses that things will start to stabilize in 2010 and thereafter. I do strongly believe that the worst is over and it is behind Citigroup. Are you looking to invest in any other financial services companies? No, no. I mean, at this stage, we have Citigroup. We are always on the move, always looking for opportunities, but at this stage, I think our investments in Citigroup are fine with us. So I don't think we'll invest more in that financial arena anymore. What other arenas are you researching for possible investments? Now we are very much concentrating on where we have two major, two huge projects in Saudi Arabia that between them, there are going to be requiring investments of about $30 billion. And one of those is in Jeddah, because it's a very fast formation city. The city doesn't have any huge transformations. It has been that way for the last three decades. So this is going to have major transformations and this is going to have a highest rise tower in the world, higher than one kilometer, and we are already in the final stages of commencing the project. In Riyadh, there’s going to be a huge project that will house at least 12,000 units with inhabitants of approximately 150,000 people. It's like a city within a city. So these are really going to take quite a bit of our energy here. But you have to understand that real estate has been hit all over the world, but in Saudi Arabia it's very much different because demand is way, way beyond supply. So it's an inverse of other countries whereby supply is more than demand. How is the real estate market overall doing in the Middle East? It depends, you know. Some countries, like Saudi Arabia, where the population growth is very high, whereby you don't have the mortgage low yet. Still the demand outstrips supply by much. Some other countries, like Dubai, for example, whereby the supply has overtaken demand by huge multiples, that's where the impact was more dramatic. So really, we can't generalize and say all the Middle East is uniform from the real estate point of view. Would you look into purchasing more American real estate? Well, we are a presence in the U.S., but maybe not directly through our real estate in the ownership of hotels. For example, we own the Plaza in New York. We own, for example, the Four Seasons brand with Bill Gates. We own the Fairmont brand with the Colony group, private equity. I own almost 100 hotels in North America. Some of them are only in management, but some of them we have some small stakes in them. So we are in the real estate arena in the United States indirectly through our hotel portfolio. - 4 - And obviously in Europe it's a bit different because we bought Euro Disney in Paris. And we obviously have a lot of capital in hotels in Europe also, like the Savoy in London, like Grand Hotel in Monte Carlo, George V in Paris, Duburg, Geneva, et cetera. And this is not only management but also ownership of real estate. When you look for real estate investments, what are your metrics for determining good and bad investments? Obviously, real estate has been hit badly in the world. And clearly now, it's cheap. But we're not just going to look for cheap, we would like to get some value. And there are some things of increasing value in what we buy. When you're looking for companies to invest in, do you look at their management? Well, clearly, when we look into companies, there are several factors. First of all, the entry value is very high, and then if the company is experiencing some difficulties, either because of cyclical events or competition or because of bad management. I mean, sometimes some companies have bad management and when bad management changes, the actual rate of change in the company. So all these things interact together when you analyze the company and before we decide whether to invest or not. How are your charitable foundations doing? As you know, we just established the charity foundation; it just began. Actually, our charity began more than 30 years ago, but right now we have officialized it by establishing the Alwaleed bin Talal charity foundation. And it's been launched some six, seven months ago and it is thoroughly covering Saudi Arabia and the globe in many areas. For example, I am invested in some charities and philanthropies in Africa, we are involved in more than 20 countries through building schools, housing units, clinics, hospitals. And obviously in the Middle East we are very much involved in charity. For example, the Yemen catastrophe, we were the supporters there. When the Tsunami hit the Southeast, we were the single largest contributor by contributing huge amounts in Indonesia, Bangladesh and Sri Lanka. How do you determine what areas to do your charitable work in? We have a division that gets involved immediately in emergency situations, on an urgent basis in catastrophes. But obviously we have an ongoing support for many Saudis and in the housing and in schools and hospitals. You know, Saudi Arabia has a lot of poverty also. Regardless about what you hear about the viceroy and people being rich, et cetera. But there are other parts of Saudi Arabia and we are much involved here, entrenched in supporting the Saudi community in those areas.