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Bin Salman ‘bullying’ wealthy Saudis for money 

September 20, 2019 at 1:01 pm

Saudi Prince AlWaleed Bin Talal [Syed Saleem/Facebook]

Declining global confidence in the Saudi economy has driven Crown Prince Mohammed Bin Salman into a familiar tactic of bullying and coercing some of the kingdom’s many wealthy families in an effort to pump cash into the state-run oil company Aramco.

The plan, according to the Financial Times, is to build confidence in the Saudi Aramco deal, which has been rocked by last weekend’s devastating attacks on Riyadh’s largest oil processing plant, Abqaiq. It’s feared that Saturday’s attack, on what is described as the heart of the kingdom’s oil industry, nearly halved Riyad’s capacity through the loss of 5.7 million barrels a day or the equivalent of five per cent of global supplies.

In addition to the sharp drop in Saudi export capacity, an equally greater crises that will have long term consequences is the dent inflicted on investor confidence. It could not have come at a more critical time for Riyadh. The crown prince, popularly known as MBS, is planning to float Aramco, the crown jewel of the kingdom on the international market. But his optimistic valuation of $2 trillion is thought to be way off the mark. Many analysts think a valuation of half that amount, $1-$1.5 trillion is more realistic.

READ: Saudi Arabia importing oil following attack

To boost confidence MBS is reported to have resorted to some unsavory tactics. Four of the sources cited in the FT said that the crown prince aims to “strong arm”, “coerce” or “bully” some of the wealthiest families in the kingdom to become cornerstone investors in Aramco’s flotation, described as the world’s biggest ever IPO (Initial Public Offering).

Many of the families include those detained by MBS in Riyadh’s Ritz-Carlton Hotel in 2017 during a crackdown billed as an anti-corruption campaign. Detainees included some of the country’s most high-profile businessman including Prince Alwaleed Bin Talal. An estimated $106 billion is said to have been recovered through settlements with scores of senior princes, ministers and top business people.

It’s reported that dozens of the same wealthiest Saudi families have been approached for money. One Saudi tycoon is said to have been tapped for as much as $100 million. He is believed to have been one of the dozens of wealthy detainees in the Ritz Carlton. An adviser of the unnamed businessman said “he is now being encouraged to do his patriotic duty for the kingdom,” adding that “there is a limit on how patriotic he wants to be.”