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03 March 2024

Rich feel the pinch as their wealth slides

Saudi Prince Alwaleed's Kingdom Holding posted profit after a massive loss in Q4 last year. (SUPPLIED)

By Nic Ridley

It is wrong to take comfort in the suffering of others, but there can be few people who are not secretly happy that the super-wealthy are in the same financial boat as the rest of the world.

As choppy seas of the financial storm send portfolios of investments crashing against the rocks, the wealthy collectively have seen billions – dirhams or dollars – wiped off their personal wealth.

The Times of London last weekend published the Rich List, its annual voyeuristic peek at the value of the obscenely wealthy in the UK.

And for the first time in the 20-plus years it has been compiled, there was a significant – if that it not understating it – slide in the predicted net worth of major household names.

In the unenviable position of top of what the paper dubbed the Bonfire of the Billionaires was Lakshmi Mittal who has lost £16.9bn (Dh90bn) in the past year. Say it again, slowly: £16.9bn.

Behind him was Russian oil magnate and Chelsea owner Roman Abramovich, who has seen his value reduced by £4.7bn, to £7bn.

Yet, the wealthy of the UK are not alone in their fiscal suffering, as Emirates Business reported last weekend in what turned out to be the most popular story among the paper's online readers.

In a feature headlined "In the grip of bull and bear", we told how Saudi billionaire Prince Alwaleed bin Talal's diversified Kingdom Holding posted Q1 profit of 50.1 million riyals (Dh49m) following a devastating fourth quarter in 2008, when it reported more than $8bn in losses.

The figure was 83.5 per cent off 2008's first quarter, when it recorded 303.8 million riyal in profit.

Alwaleed, a member of the Saudi royal family and the nephew of King Abdullah, has said little in recent months about his company's stake in beleaguered Citigroup, which accounted for more than 40 per cent of the total value of Kingdom Holding's assets when it issued an IPO in 2007.

But his stake in Citi – at one time valued at around $7.5bn (Dh27.5bn) – is now only worth $622 million, mirroring the massive drops in the market caps of some of the world's biggest firms.

Over all, the ranking of the best-read stories online (see panel left) was eclectic, to put it mildly.

Coming in at number two was a preview from of the clashes between Man United and Arsenal and Chelsea and Barca in two semi-final showdowns for the Champions League.

The print edition was accompanied by an exhaustive graphic of each of the clubs' marathon route to the semis.

In third place, was a review of two of BlackBerry's latest offerings. Storm and Bold went head-to-head to help people ready to upgrade get the addictive little gadget that is best for them.

Reviewer Colin Simpson said the touchscreen Storm was Research in Motion's best challenger yet to the increasingly ubiquitous Apple iPhone. "Make no mistake, [Storm and Bold] are both powerful and impressive devices," he said.

In fourth position was Emirates Business' interview with Dubai Department of Finance Director-General Nasser al Shaikh. While reluctant to talk about himself, he was happy to tell deputy news editor Sean Davidson the fundamentals of Dubai had not changed – and only the long view would see the emirate through the current crisis.

"There are only a few places in the world where you can see what 200 nationalities can do," he said. "And this is one of those."

Compulsive reading.