PIF buys stakes in Citi, Boeing, Disney, Facebook

PUBLIC INVESTMENT FUND (PIF) TOWER; Centerpiece of KAFD and tallest building in Riyadh

Saudi Arabia’s sovereign-wealth fund bought billions of dollars of stock as the global pandemic took root. It reports significant stakes on Friday in companies including BP Plc, Boeing Co., Citigroup Inc. and Facebook Inc.

The Public Investment Fund (PIF) was a holding company for government stakes in domestic businesses five years ago. It disclosed an $827.8mn stake in BP; a $713.7mn investment in Boeing; and $522mn positions in both Citigroup and Facebook at the end of the first quarter.

Other bets include $495.8mn on Walt Disney Co. and $487.6mn on Bank of America Corp.

Grasping opportunities

The PIF is looking into “any opportunity arising from the economic wreckage of the crisis”; the fund’s governor, Yasir Al-Rumayyan, said at a virtual event in April. The fund expects to see “lots of opportunities, he also predicted at the time; citing airlines, energy and entertainment companies as examples.”

Behind the scenes, as coronavirus outbreaks disrupted commerce and drove stock prices to their lowest levels in years, the $320 billion sovereign wealth fund reassigned staff to find bargains to broaden its global portfolio, people familiar with the plan have said.

The investments disclosed in a quarterly filing Friday amount to a bet that marquee names of the corporate world will rebound as many facets of life return to normal.

Other holdings

Other holdings described by the fund include a $513.9mn investment in hotel owner Marriott International Inc. that’s even greater than the PIF’s previously disclosed wager on cruise operator Carnival Corp. Both companies are contending with a virtual shutdown in global travel.

Similarly, the fund gathered a $416.1mn stake in concert promoter Live Nation Entertainment Inc., which faces bans on large gatherings.

The fund also amassed shares of Canadian oil sands players Suncor Energy Inc. and Canadian Natural Resources Ltd.; on top of investments that previously emerged in Equinor ASA, Royal Dutch Shell Plc, Total SA and Eni SpA.

The bargain-hunting contrasted with retreats by the likes of Warren Buffett’s Berkshire Hathaway Inc.; which previously announced a full exit from investments in four major US airlines. On Friday, Berkshire also disclosed that it sold off most of a longtime investment in Goldman Sachs Group Inc.. It also trimmed stakes in companies including JPMorgan Chase & Co.

Coincidentally, the fund bought a $78.4mn stake in Berkshire as well. The PIF’s mandate broadened in 2015 by Crown Prince Muhammad Bin Salman to include international investments to support economic diversification.