The Islamic Post Blog

Billionaire Investors Watch, Wait, Buy by Khalida
February 2, 2009, 8:52 am
Filed under: January Volume I- 2009, Latino/Caribe | Tags:

Financial barons are taking advantage of the troubled global market and low share prices.

By Mubeen Khaleel

Islamic Post Staff Writer

Carlos Slim Helu, known as Latin America’s richest man, is moving in on falling stock prices by purchasing extra shares in a few troubled, yet major, companies.
An analyst informed about one of the financial baron’s transactions made with Citigroup, told AFP that the investment firm owned by the Mexican billionaire now owns a one percent stake in the financial corporation, which was recently rescued by the United States’ government. The stake –amounting to nearly 26 million shares and worth almost $150 million– is “a portfolio investment of Grupo Financiero Inbursa,” said the analyst, who requested anonymity. Reuters reported Citigroup’s shares to have sunk to lows not seen since 1992.
“He’s taking advantage of prices,” Rogelio Gallegos, a portfolio manager at Actinver in Mexico City, told Reuters. Carlos Slim has been noted to have a “Midas touch” history of acquiring struggling businesses at low costs and turning them into profitable cash-cows. “It’s the best moment in the last five years to take stock market positions,” said Mr. Galegos.
Mr. Slim also increased his stake in the U.S. luxury retailer, Saks, to 18 percent, making him the company’s biggest investor, the news agency reported.
The new deals occurred only months after Mr. Slim Helu declared the current financial crisis to be a “very difficult situation,” the worst he had ever seen. He anticipated it would effect all economies and “impact everybody.” Slim also suggested in September that bank shareholders and executives should shoulder at least some responsibility for failing financial institutions.
Whether Carlos Slim’s new investments can be seen in this light or not, other billionaires are also embarking on new ventures, including Carl Icahn (1.8 billion invested in a floundering Yahoo!), Warren Buffett (proposed takeover of Constellation Energy Group, Inc.), and Chalva Tchigirinski, a Russian majority owner of Sibir Energy, which allowed his $340 million personal real estate buyout by the company).