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Saudi fund adds Disney, Facebook to entertainment stocks

The PIF, which owns nearly 6% of Live Nation, bought into the Walt Disney Company, Facebook, Marriott, BP, Boeing and Starbucks in Q1 2020

By IQ on 25 May 2020

Saudi Arabia's PIF owns around $500m worth of the Walt Disney Company

Saudi Arabia's PIF owns around $500m worth of the Walt Disney Company


Saudi Arabia’s acquisitive sovereign-wealth fund added investments in leisure and media giants including the Walt Disney Company, Facebook and Marriott International in the first financial quarter of 2020, according to newly revealed US regulatory filings.

According to the Financial Times, the Public Investment Fund (PIF) – which made headlines last month after buying half a billion dollars’ worth of Live Nation shares – spent nearly US$8bn on US and European blue-chip stocks in the first three months of the year, as the Gulf kingdom seeks to benefit from low prices on stock markets spooked by the coronavirus pandemic.

The Live Nation share purchase, along with an earlier buy of Carnival Cruise Line stocks, were picked up by industry and financial press at the time, as the value of the deals (relative to the size of the companies) required that the US Securities and Exchange Commission (SEC) be notified.

However, the earlier purchases were also sizeable: Among the PIF’s pre-Live Nation investments are a $827.8m stake in BP, a $713.6m stake in Boeing and smaller investments in Bank of America, Citigroup, Starbucks and drugmaker Pfizer, reports the FT.

IF says it is “identifying opportunities to invest in solid companies with strong, long-term outlooks”

The stakes in Disney and Facebook are valued at $496m and $523m, respectively, SEC filings reveal.

The fund has also been linked with Warner Music Group in recent weeks.

A senior Saudi official told the FT in April that the kingdom had set up a dedicated team to look at the “midterm and long-term, downside and upside” of the global economic crisis caused by governments’ response to the spread of Covid-19.

The PIF says it is “identifying opportunities to invest in solid companies with strong, long-term outlooks who we expect will be sector leaders when global economic activity begins to approach pre-pandemic levels”.

Other sovereign funds in the oil-rich Middle East, including Abu Dhabi’s Mubadala, and the Qatar Investment Authority, are also seeking investment opportunities, the paper reports.

 


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