Saudi’s UK investment drive goes full throttle

When Aston Martin teamed up with California-based Lucid Motors to develop a range of electric cars last month, it was heralded as James Bond’s favorite car brand joining forces with a Silicon Valley-based technology group.

But it was much more than that.

Looking under the hood, a closer inspection revealed the not-so-hidden hand of Saudi Arabia, one of the world’s largest exporters of oil and natural gas.

Lucid is majority owned by the Public Investment Fund, the sovereign wealth arm of the Saudi state, responsible for channeling billions of pounds of fossil fuel money into projects and companies around the world.

The PIF is estimated to manage assets worth more than £500 billion and is chaired by the de facto ruler and prime minister of Saudi Arabia, Crown Prince Mohammed bin Salman of the ruling Al Saud dynasty, who is commonly known by his initials, MBS .

The PIF is also the second largest investor in Aston Martin, with an 18 per cent stake worth around £450 million. It is the ultra-conservative kingdom’s latest move to use its huge piles of cash to expand its economic clout in Britain, following the lead of other Gulf states, such as Qatar, who have pumped oil wealth into the UK.

In addition to its interest in Aston Martin, the PIF also has interests in cruise ship company Carnival. But perhaps the most controversial moves have been in the world of sports.

In 2021, it raised eyebrows when the Premier League football team invaded Newcastle United and bought the club from its former owner, Sports Direct mogul Mike Ashley.

The Saudi consortium was assisted by British businesswoman Amanda Staveley, who is known for her connections with Middle Eastern investors. But the takeover was marred by allegations of sportswashing, a practice whereby regimes with questionable human rights records use professional sports to repair their image.

Supporters of the takeover argued that opposition to the deal was rooted in racism and compared the uproar to that seen in takeovers of other major English football clubs by Middle Eastern lenders.

The country’s influence in the world of sports came back into the spotlight last month when a proposed merger between the Saudi Arabian-backed LIV Golf Tour and the US PGA Tour sparked international outrage from activists and some of the sport’s biggest names.

Connections: Amanda Staveley helped the PIF buy Newcastle Utd

The kingdom also signed a ten-year contract with Formula 1 to host Grand Prix races, and is also thought to aim to host the 2030 FIFA World Cup in a manner similar to last year’s tournament in Qatar.

Riyadh’s struggle to penetrate the professional sports world is part of a charm offensive that many see as an attempt to whitewash the country’s reputation and cover up its dismal record on human rights and draconian laws. Among these are same-sex activities which are illegal and punishable by death, although the law is not always enforced, and severe restrictions on women’s rights.

MBS is also said to be trying to mend fences after the 2018 killing of journalist and democracy activist Jamal Khashoggi by Saudi agents in the country’s embassy in Turkey.

“The way the Saudi authorities use their sovereign wealth fund shows that it is not only a simple vehicle for state investment, but also a tool for state-level image management,” said Peter Frankental, director of economic affairs at Amnesty International UK.

“Saudi Arabia’s purchase of Newcastle United was a spectacular act of sportwashing and the strategy with Aston Martin can be seen as a concerted approach, with the country trying to absorb the brand’s prestige and even add a bit of gloss to it.” .” of his association with James Bond.’

The kingdom’s investments abroad are also a testament to its drive to diversify its economy away from oil. But while there are detractors of Saudi money inflows, there is a complicating factor: the PIF has deep pockets and the potential to help fund long-term investments that Britain desperately needs.

License to thrill: Daniel Craig as 007 with an Aston Martin sports car

Large infrastructure projects, such as the Sizewell C nuclear power plant, are likely to require funding from state funds and ministers have courted the Gulf states for support, The Mail on Sunday understands.

At present, there appears to be no sign that the flow of Saudi money will stop flowing in as the country has benefited from the recent rise in world oil prices following the Russian invasion of Ukraine.

A government spokesman said: “Saudi Arabia is our largest trading partner in the Middle East and we have a long-standing relationship based on a range of strong mutual national interests, including bilateral investment. We are also working on a free trade agreement with the Gulf Cooperation Council, which will support the government’s priority to stimulate the economy, create jobs and raise wages.”

In addition to the Saudi state’s own investment, Saudi investors, like many of their counterparts in countries such as Qatar and the United Arab Emirates, are becoming increasingly interested in the UK’s lucrative real estate market.

Turki bin Salman Al Saud, the ninth son of Saudi King Salman bin Abdulaziz, reportedly owns nearly 20 properties in London through Moncrieff Holdings, a company based in the British Virgin Islands.