Saudi Prince Trims His Portfolio
Billionaire Saudi Prince Al Waleed ibn Talal ibn Abdulaziz al Saud, a self-proclaimed “buy and hold” investor, apparently has sold shares of McDonald’s Corp. (ticker symbol: MCD), Coca-Cola Co. (KO) and Gillette Co. (G) in recent months.
The three companies weren’t on a list of current holdings provided by Al Waleed’s office, after appearing on a list distributed in November. Donna Karan International Inc. (DK), Hyundai Motor Co. (HYMTF) and Malaysia’s No. 1 auto maker, Perusahaan Otomobil Nasional, or Proton, also are missing. The jettisoned shares were worth about $320 million in November.
Al Waleed, a nephew of Saudi Arabia’s King Fahd, says he’s a long-term investor who buys shares of companies with well-known brands whose stocks have been beaten down.
His sale of Coke and Gillette shares runs counter to the decision of billionaire Warren Buffett, who recently said he plans to hold the stocks. Al Waleed’s fortune was valued at $20.1 billion on the most recent listing of his holdings, down from $20.7 billion in November.
“The philosophy for the ‘value’ investor is you stick with the stock,” said Ronald Hill, investment strategist at Brown Bros. Harriman & Co. in New York. “Some things you hold forever.”
Al Waleed reported his biggest holdings were Citigroup Inc. (C), at $9.65 billion, News Corp. (NWS), $1.10 billion, and AOL Time Warner Inc. (AOL), $932 million.
By comparison, the stakes Al Waleed recently sold were small. His shares in Gillette, the top razor maker, were worth $55 million in November. The stake in McDonald’s, the biggest fast-food chain, was worth $49 million. The shares of Coke, the largest soft-drink maker, were worth $62 million.
For the prince, who is spending most of August off Cannes, France, aboard his 281-foot yacht, this appears to be the second round of portfolio trimming in the last year.
Xerox Corp. (XRX) and Korea’s now-insolvent Daewoo Corp., as well as Internet companies DoubleClick Inc. (DCLK), InfoSpace Inc. (INSP) and Internet Capital Group Inc. (ICGE) all were missing from the November list after appearing in a May 2000 disclosure.
Al Waleed, who isn’t required to disclose all his holdings, occasionally distributes a list to members of the news media. The list gives a dollar value for each investment and the percentage of each company owned. It doesn’t say on what day the values were calculated, or how many shares he owns.
While dumping his Coke shares, Al Waleed held onto a $70-million stake in rival Pepsico Inc. (PEP). Pepsi stock has outperformed Coke’s in the last 12 months, returning 1.7% through Wednesday, while Coke fell 24%.
