"Hello, my friend."
"Welcome to London, Walid."
In May, Prince Walid and his wife Princess Amina came to London. As an important partner, Baron hosted a banquet in his villa in Kensington to welcome the couple.
In the early days of DS Capital, Prince Walid was one of their main investors, and the two sides have maintained a good cooperative relationship until now.
"Your Highness, I found that your fund has reduced its holdings of many company stocks. Are you not optimistic about the future market?"
After dinner, when the two sat down to chat, Prince Walid suddenly raised this question.
Unlike when Baron first established the private equity fund of DS Capital, he still needed to seek investors through various means. Now the funds under the DS Group have been able to attract more and more funds to join the investment or buy their financial products. This is because Baron's investment ability has been widely recognized.
At the same time, it is also because of this that many people will also study the investment direction of some of his funds to observe his investment strategy.
Even though many of DS Group's investments are not public, we can get a general idea of it from the disclosure of some fund flows and holdings.
It's the same as when Buffett is pessimistic about the market, many people will become more cautious in investing.
Prince Walid is a well-known investor, but he has also known Barron for a longer time and knows his investment strength better, so he will also refer to Barron's views on the entire market.
This is why Barron shorted the subprime mortgage crisis by low-key acquisition of Black Swan Fund. It is also because by now, DS Group has become one of the most well-known investment companies in Britain, and there are too many eyes on it. It can be said that many of his investments can affect more funds and thus affect the direction of part of the investment market.
"Some of my funds are indeed reducing their holdings of some stocks. After all, some investments have reached the time to complete some profit exits, and I will also have some acquisition plans recently, which require raising some funds."
Barron will naturally not reveal his true thoughts, but he will not hide them completely. After all, the two sides still have a close cooperative relationship, so there is no need to "act" too much.
He said to Walid with a serious look:
"Of course, to be frank, there is also the idea of risk avoidance. You should understand that with the current scale of funds, it is also necessary to adjust the investment ratio appropriately."
"This may be necessary for some securities investments, but my investment direction is still mainly based on entities. Even if there are economic cyclical fluctuations, I just need to hold on."
This is true. Walid's investments are mostly high-quality assets. Even the Citibank he invested in, whose stock price plummeted during the subprime mortgage crisis, has slowly recovered in the following years - this is the importance of not adding too much leverage in investment. Even if there are huge fluctuations in the short term, you only need to hold on, and those high-quality assets will always return to their due prices.
Next, Barron talked to Walid about the Four Seasons Hotel Group.
When the Global Industrial Investment Fund, or GII Fund, was first established, they completed the privatization of Four Seasons Hotels and Resorts together with Prince Walid's Kingdom Investment. Currently, GII Fund and Kingdom Investment each hold 47.5% of the shares of Four Seasons Hotels and Resorts. The remaining 5% of the shares of Four Seasons Hotels and Resorts are held by the family of Isadore Sharp, the founder of Four Seasons Hotels and Resorts - they have also been responsible for the operation of Four Seasons Hotels. This time, the Devonshire Family Trust hopes to continue to acquire the shares of the Four Seasons Hotel Group held by Prince Walid, and finally complete the merger of the Four Seasons Hotel Group with the Cavendish Hotel Group owned by the Devonshire Family Trust.
As for why not wait until the subprime mortgage crisis breaks out, the global economy is affected, and the market value of many companies falls before making this acquisition.
The reason is that the Four Seasons Hotel Group has completed privatization, and its market value will not be reflected through stock prices. Of course, their revenue will also be affected and fall to a certain extent, but the other reason is that, as Prince Walid said, his investments will be held for a long time, and it is naturally impossible to sell them at a low price during an economic crisis-unless it is affected by the economic crisis and needs to give up some assets to raise funds to save other industries.
But it is obvious that Prince Walid will not have such a situation.
Therefore, since this is the case, it is better to propose a more reasonable price now, even if the other party has not agreed to it for the time being, but when the subprime mortgage crisis breaks out, if Barron is still willing to acquire it at that price, then the other party's feelings will be completely different-well, a feeling of friendship.
This time, Barron proposed to acquire Prince Walid's 47.5% stake in the Four Seasons Hotel Group for $1.66 billion.
According to this price, the valuation of the Four Seasons Hotel Group by the Devonshire Family Trust this time will reach about $3.5 billion. Compared with the valuation of $2.86 billion when the Four Seasons Hotel Group was privatized at that time, its price has risen by more than 22%, which is also a very reasonable price.
"I have stayed at the Devonshire Hotel in London and Paris, and I am really impressed by the brand of this hotel. If the Four Seasons Hotel Group and Cavendish Hotel Group merge, I agree very much, which will benefit both parties. But as for selling shares, Barron, I haven't considered this issue yet."
"This is just a proposal. I have the idea of promoting this plan. Of course, it also requires the right time. I hope you can consider it carefully, Walid, I will keep this price."
Since Walid temporarily rejected this proposal, Barron temporarily passed the matter over and turned to other aspects.
Prince Alwaleed was very interested in the British Automobile Group established by Barron. When he heard that Bentley and Aston Martin were about to launch new models, he was very interested in visiting the production bases of the two brands during his stay in England to see the new models with his own eyes.
Bentley's new flagship Mulsanne was first unveiled at the Geneva Motor Show in March. However, the car on display at that time was still the initial standard model, but it attracted great attention as soon as it was unveiled.
So far, Bentley's Crewe factory has only completed the production of two Mulsanne sedans, and has not yet begun to accept public orders.
One of the two sedans is a queen's car specially customized for the royal family. It will be delivered to the royal family this month and will be unveiled at a public ceremony next month.
The other is an extended Mulsanne customized for Barron. The exterior and interior leather of the car will bear the Devonshire family emblem.
Barron naturally welcomes Prince Alwaleed's idea of visiting the Bentley factory. After all, he is likely to be one of Bentley's first customers.