Ken Moelis, the prominent investment banker, traveled to Riyadh, Saudi Arabia, to extol the virtues of friendship — and make money.
The Los Angeles business titan — whose company was selected last year to advise on the planned initial public stock offering of Saudi national oil company Aramco — stood out as many of the other leading figures in U.S. finance sat out the kingdom’s investment conference amid international outrage over the killing of government critic Jamal Khashoggi.
Speaking on a panel that included the head of Russia’s VTB Bank, which is operating under U.S. sanctions, Moelis told the audience in the crowded conference room at the Ritz Carlton Hotel on Tuesday that relationships are a company’s most valuable asset — even if there’s no way to account for them on the balance sheet.
He subsequently declined to answer reporters’ questions, underscoring the dilemma faced by those who decided to attend or avoid the gathering — the latter group including U.S. Treasury Secretary Steven T. Mnuchin.
The conference is the brainchild of Saudi Crown Prince Mohammed bin Salman, held to showcase the kingdom’s investment opportunities. Attendees gave the smiling 33-year-old crown prince applause when he showed and posed for pictures.
But there was no hiding the fact that elsewhere in the Middle East as the conference was kicking off, Turkish President Recep Tayyip Erdogan was telling lawmakers in his country that he rejected the Saudis’ explanations for the death of Khashoggi, a Washington Post columnist, in their consulate in Istanbul.
Dr. Patrick Soon-Shiong, the billionaire owner of the Los Angeles Times, pulled out of the conference, as did many other media chieftains.
Others who didn’t show included the chief executives of some of the Saudis’ main financiers and business partners: Blackstone Group’s Stephen Schwarzman, JPMorgan Chase & Co.’s Jamie Dimon, HSBC Holdings’ John Flint and BlackRock Inc.’s Larry Fink.
Also not showing was Bank of America Corp.’s Chief Operating Officer Thomas Montag and Ralph Schlosstein, chief executive of Evercore Inc., the investment banking advisory firm co-founded by current Los Angeles schools chief Austin Beutner.
But most of those executives head firms with the balance sheet and history to weather any potential storm. Moelis, 60, leads a boutique New York investment bank with fewer than 1,000 employees. It was founded in 2007 with offices in New York and Los Angeles — where records show Moelis owns several area homes — but now boasts outposts in other U.S. cities, Brazil, Asia, Australia and the Middle East.
Winning a 2017 mandate to advise on the planned IPO of Saudi Aramco was a coup that promised Moelis & Co. its biggest payday ever. While the date for potentially the largest-ever IPO has receded into the future, the mandate earned him the nickname "Ken of Arabia."
Bloomberg estimated Moelis’ wealth at $1 billion in April, but there is more money to be made. Just as the Khashoggi scandal was unfolding early this month, the crown prince vowed that the Aramco IPO would proceed by 2021, potentially raising $100 billion at a record $2-trillion valuation. Still, that was then, even if just a few weeks ago.
Most financial firms opted to send regional executives to the conference as they attempt to walk a fine line between the risks of stoking the outcry over the killing and losing future business in Saudi Arabia. Also walking a fine line was SoftBank Group Corp. Chief Executive Masayoshi Son, whose $100-billion Vision Fund has a $45-billion commitment from Saudi Arabia’s Public Investment Fund.
The Japanese billionaire met with the crown prince in Riyadh on Monday, but was not expected to attend the conference, according to people familiar with the matter.
Key executives who are participating in the summit or are scheduled to do so include Patrick Pouyanne, CEO of Total SA; Lorenzo Simonelli, CEO of Baker Hughes; Paal Kibsgaard, CEO of Schlumberger Ltd.; Loh Boon Chye, CEO of Singapore Exchange Ltd.; Kirill Dmitriev, CEO of Russian Direct Investment Fund; Jim Breyer, CEO of Breyer Capital; and Alberto Galassi, CEO of Ferretti SpA.
Saudi Arabia has signed more than 25 deals as it tries to salvage its forum, including accords with French oil giant Total SA, oil-services provider Halliburton Co. and Hyundai Heavy Industries Co. Some of the deals, totaling about $50 billion, had been announced previously, while others were for new ventures or marked progressive steps on existing agreements.