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BRIEFING BOOK

Data Information Knowledge WISDOM

PRINCE ALWALEED BIN TALAL

Location: Forbes, New York, New York

About Prince Alwaleed Bin Talal ...................................................... Debriefing Bin Talal ...............................................................

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Bin Talal in Forbes

"Apple Can't Save Saudi Billionaire,” 07/21/09……………….. "A Week With Prince Alwaleed," 03/27/09…………………….. "I Just Can't Wait To Be King," 03/11/09 ……………………… "Royal Treatment Can't Save Citi," 11/20/08 ……....................

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The Bin Talal Interview ………………………………………….. 17

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ABOUT PRINCE ALWALEED BIN TALAL Intelligent Investing with Steve Forbes

Prince Alwaleed Bin Talal Bin Abdul Aziz Alsaud is chairman of investment company, Kingdom Holding Company, which went public on the Saudi stock exchange in 2007. He is the 22nd wealthiest person, according to the 2009 Forbes World's Billionaires list. Kingdom Holding contains his investments in companies such as Citigroup and News Corp., as well as Four Seasons Hotels and Fairmont Hotel management companies, among many others. Alwaleed joined the Singapore government investment arm and several other investors in a $12.5 billion capital injection for Citigroup in January 2008; the size of his investment is undisclosed. He is also an investor in mainstream technology companies like Apple Computers, Motorola and AOL. Though Alwaleed is a member of Saudi Arabia’s royal family, he has mostly stayed away from joining in politics, preferring to pour energy into his stock market and real estate ventures. He has been outspoken about his disapproval over traditionalist political moves, especially the treatment of women in Saudi Arabia. In 2004, he hired the first female airline pilot in Saudi Arabia. Alwaleed got his bachelor’s degree in business administration from Menlo College and a master's degree in social science from Syracuse University. He is currently married and has two children.

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DEBRIEFING BIN TALAL Intelligent Investing with Steve Forbes

Interview conducted by Alexandra Zendrian January 11, 2010 Forbes: How has Kingdom Holdings been doing lately and how do you anticipate it doing this year? Prince Alwaleed Bin Talal: I think 2009 was a tough year, but that's behind us. We are very optimistic about 2010 and thereafter. We are seeing all our subsidiaries and our affiliates beginning to seem more alive and seeing some growth. What is fueling that growth? What gives you a reaso n to be more optimistic about 2010? Well, you know, I'm talking basically about the Middle East. The Middle East, as you can understand, was not impacted as much as the United States and other areas were impacted. Really, the impact here was minimal. So we are beginning from a better point to begin with. And remember, the Gulf region is still very much oil based, and the price of oil is around $80, so we have all these tailwinds behind us. In your personal holdings, you have some media comp anies. How do you foresee those doing in the near future? One of my biggest personal holdings is Rotana. That company has a very dominant force in the Middle East. It has around 45% of all the movie industry and around 75% of all the music. And this is doing extremely well. It's growing around 14 to18% every year and has top, top revenues. What do you look for when you're making investments ? When we look at investments, we look at the company to see if it has a global presence. We look at companies with an entry point that can achieve 20% growth within a five to 10 year time horizon. So, if you look at what's common among some of the companies I have, including the Four Seasons, NewsCorp, George V, the Plaza, these are all irreplaceable brands in their own fields. Kingdom Holdings is also invested in Citigroup. How do you see that doing this year? Citigroup also is a blue chip name. Unfortunately, in the past two years, it has faced tremendous difficulties; a lot of headwinds. We hope that under the leadership of Mr.

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Vikram, and after paying the TARP, and after maybe taking some losses that things will start to stabilize in 2010 and thereafter. I do strongly believe that the worst is over and it is behind Citigroup. Are you looking to invest in any other financial se rvices companies? No, no. I mean, at this stage, we have Citigroup. We are always on the move, always looking for opportunities, but at this stage, I think our investments in Citigroup are fine with us. So I don't think we'll invest more in that financial arena anymore. What other arenas are you researching for possible investments? Now we are very much concentrating on where we have two major, two huge projects in Saudi Arabia that between them, there are going to be requiring investments of about $30 billion. And one of those is in Jeddah, because it's a very fast formation city. The city doesn't have any huge transformations. It has been that way for the last three decades. So this is going to have major transformations and this is going to have a highest rise tower in the world, higher than one kilometer, and we are already in the final stages of commencing the project. In Riyadh, there’s going to be a huge project that will house at least 12,000 units with inhabitants of approximately 150,000 people. It's like a city within a city. So these are really going to take quite a bit of our energy here. But you have to understand that real estate has been hit all over the world, but in Saudi Arabia it's very much different because demand is way, way beyond supply. So it's an inverse of other countries whereby supply is more than demand. How is the real estate market overall doing in the Middle East? It depends, you know. Some countries, like Saudi Arabia, where the population growth is very high, whereby you don't have the mortgage low yet. Still the demand outstrips supply by much. Some other countries, like Dubai, for example, whereby the supply has overtaken demand by huge multiples, that's where the impact was more dramatic. So really, we can't generalize and say all the Middle East is uniform from the real estate point of view. Would you look into purchasing more American real e state? Well, we are a presence in the U.S., but maybe not directly through our real estate in the ownership of hotels. For example, we own the Plaza in New York. We own, for example, the Four Seasons brand with Bill Gates. We own the Fairmont brand with the Colony group, private equity. I own almost 100 hotels in North America. Some of them are only in management, but some of them we have some small stakes in them. So we are in the real estate arena in the United States indirectly through our hotel portfolio.

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And obviously in Europe it's a bit different because we bought Euro Disney in Paris. And we obviously have a lot of capital in hotels in Europe also, like the Savoy in London, like Grand Hotel in Monte Carlo, George V in Paris, Duburg, Geneva, et cetera. And this is not only management but also ownership of real estate. When you look for real estate investments, what are your metrics for determining good and bad investments? Obviously, real estate has been hit badly in the world. And clearly now, it's cheap. But we're not just going to look for cheap, we would like to get some value. And there are some things of increasing value in what we buy. When you're looking for companies to invest in, do you look at their management? Well, clearly, when we look into companies, there are several factors. First of all, the entry value is very high, and then if the company is experiencing some difficulties, either because of cyclical events or competition or because of bad management. I mean, sometimes some companies have bad management and when bad management changes, the actual rate of change in the company. So all these things interact together when you analyze the company and before we decide whether to invest or not. How are your charitable foundations doing? As you know, we just established the charity foundation; it just began. Actually, our charity began more than 30 years ago, but right now we have officialized it by establishing the Alwaleed bin Talal charity foundation. And it's been launched some six, seven months ago and it is thoroughly covering Saudi Arabia and the globe in many areas. For example, I am invested in some charities and philanthropies in Africa, we are involved in more than 20 countries through building schools, housing units, clinics, hospitals. And obviously in the Middle East we are very much involved in charity. For example, the Yemen catastrophe, we were the supporters there. When the Tsunami hit the Southeast, we were the single largest contributor by contributing huge amounts in Indonesia, Bangladesh and Sri Lanka. How do you determine what areas to do your charitab le work in? We have a division that gets involved immediately in emergency situations, on an urgent basis in catastrophes. But obviously we have an ongoing support for many Saudis and in the housing and in schools and hospitals. You know, Saudi Arabia has a lot of poverty also. Regardless about what you hear about the viceroy and people being rich, et cetera. But there are other parts of Saudi Arabia and we are much involved here, entrenched in supporting the Saudi community in those areas. Obviously our support also goes to neighboring countries such as Egypt, Lebanon, Syria, Palestine, North Africa, et cetera.

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BIN TALAL IN FORBES Intelligent Investing with Steve Forbes

Faces In The News

Apple Can't Save Saudi Billionaire Lionel Laurent, 07.21.09, 07:45 AM EDT

Tech success story can't stem quarterly earnings de cline at Prince al-Waleed's holding company.

LONDON -- Apple 's stock had a great second quarter, Steve Jobs' poor health notwithstanding. Shares

of the cash-rich iPod manufacturer rose 36% between April and June, in line with rival Microsoft but well

ahead of International Business Machines and Hewlett-Packard. But this may be of small comfort to

Saudi billionaire Prince al-Waleed bin Talal al-Saud, a 5% shareholder of Apple, whose investment firm

Kingdom Holdings announced on Tuesday an 83% drop in second-quarter profits over the year.

The problem is that for all its recent gains, Apple's stock has yet to recover losses suffered since 2008.

As of June 30 of this year, Apple was down 19% year-over-year. So while it's definitely been a better

performer than Prince al-Waleed's other stock picks--step forward Citigroup , down 83%; Eastman

Kodak , down 80%; News Corp , down 33%--it may be a while before it helps annual comparisons for

the Saudi investor.

Perhaps Apple's quarterly earnings, due later on Tuesday, will offer an extra boost. Analysts expect net

income of $1.1 billion, or $1.16 a share, compared with net income of $1.1 billion, or $1.19, from a year

ago. Sales are expected to rise to $8.2 billion, from $7.5 billion. (See "Apple's Secret Weapon: Your

Mom.")

It's not all tears for Prince al-Waleed, though. He cannily bought his 5% stake in Apple back in 1997, for

$115 million, at a time when the company was in trouble and facing down a takeover bid from Oracle .

At current prices, his stake is worth $6.8 billion, or 60 times the initial investment.

Kingdom Holdings announced second-quarter profits of 92.1 million Saudi riyals ($24.6 million) on

Tuesday, down from 534.7 million riyals ($142.8 million) a year earlier. On a sequential basis, however,

the market rally did the company some good: profits soared 83.4% between the first and second

quarter.

Shares of Kingdom Holdings were down 3.1%, to 4.70 riyals ($1.25), on the Riyadh stock market. The

stock is down 8.7% over the past month and down 48% over the year.

Al-Waleed ranked 22 on Forbes' list of the world's billionaires this year, down from number 19 last year.

(See "I Just Can't Wait To Be King.") Kingdom posted an $8 billion loss in 2008, and since then the

company has sold assets to help pay down debt.

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The World's Richest People

A Week With Prince Alwaleed Kerry A. Dolan, 03.27.09, 02:50 PM EST

Inside the life of the Middle East's richest man.

BURLINGAME, Calif.--It was an opportunity too rich to pass up. Prince Alwaleed, one of the world's

most successful investors and the wealthiest man in the Middle East, had invited me to spend a week

with him in Saudi Arabia.

His objective: prove to Forbes that he is as wealthy as he claims to be. For years, the prince had told us

he was worth several billion dollars more than the conservative estimates we printed in our list of the

World's Billionaires, and he wanted to set the record straight.

The plan was for me to tour Alwaleed's vast real estate holdings, including his lavish Riyadh palace,

meet with various executives of companies he owns, and gather other pertinent information needed to

calculate his net worth for Forbes' annual World Billionaires list.

Last March, we estimated Alwaleed was worth $21 billion; he claimed he was worth more than $25

billion. This year, amid the massive decline of Citigroup , once his largest asset via his publicly traded

holding company Kingdom Holding, Alwaleed's net worth had fallen, by our count, to $13.3 billion,

making him the 22nd richest person on the 2009 list. Again, Alwaleed insisted he was worth more,

despite serious threats to his fortune looming on the horizon. (See "I Just Can't Wait To Be King.")

But observing wealth on this scale, even for a seasoned billionaires reporter, was staggering.

I arrived in Riyadh in early October. After two days, my head was spinning. There was his impossibly

large 420-room palace, decked out in marble and decorated with large portraits and photographs of

Alwaleed, with two indoor pools and an indoor tennis court. It took an hour and a half to tour the whole

place.

Then there was the 120-acre "farm and resort" at the edge of the city with its mini-Grand Canyon, mini-

zoo, horse stables, five artificial lakes and multiple residences. It was a refreshing bit of green in an

otherwise brown landscape. The prince evidently does not worry about water bills; one afternoon the

sprinklers at the resort were going full tilt in the 90-degree weather.

Also on display: a fleet of 60 buff-and-green-colored cars and motor homes designed just for use at the

prince's desert retreat. Another garage beneath the palace holds several dozen black cars--Range

Rovers, Suburbans, Volvo SUVs and other vehicles used just for city driving.

And then came the jewelry. Upstairs at Alwaleed's palace in a wide marble hallway outside his

bedroom, the prince's petite palace manager had lined the floor with 50 wooden boxes, each containing

a lavish jewelry set fit for a king--or in this case, a nephew of the king.

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The most spectacular set on display was a diamond and emerald necklace with three emeralds the size

of sparrow eggs dangling from the center, with earrings and a ring to match. With a combined total of

200 carats, the set is worth $40 million.

Most of the jewelry on display that evening was not to his wife's liking, he said, adding that Princess

Ameera prefers less ostentatious sets. "It's too big for my wife," joked Alwaleed. "Plus you'd need to

wear a very low-cut dress to go with it."

Then why buy the jewelry? "It's an investment. I paid $50 million for jewelry worth $150 million," he said,

referring just to the swag by the bedroom. By Alwaleed's reckoning, his entire jewelry collection is worth

more than $700 million.

One night I joined him and Princess Ameera and their staff on a flight to Cairo aboard his luxuriously

outfitted Boeing 747. The main seating area of the plane has been transformed into a living room, with

luxe couches along the plane walls, and behind it, a dining room where we ate a light meal prepared by

the kitchen at the Four Seasons Hotel in Riyadh.

In Cairo, Alwaleed and his wife were among the honored guests at a charity dinner hosted by Egypt's

first lady. Queen Rania of Jordan was there, and former U.K. Prime Minister Tony Blair was the guest

speaker. Throngs of TV cameras filmed the honored guests.

Two nights later, back in Riyadh, Alwaleed and his entourage watched the recorded TV footage after

dinner. It felt like the royal version of watching home movies.

Princess Ameera, 24, is wife No. 4 for Alwaleed; they've been married for four years. He's a one-wife-

at-a-time guy, unlike some other Saudi men who may have as many as four wives at once.

Ameera, an engaging and attractive young woman whose passion is horseback riding, is studying for

an undergraduate degree on a special program Alwaleed has arranged with University of New Haven.

Professors from the U.S. teach Princess Ameera and several other young women in classrooms

located within the prince's palace.

Alwaleed has two children with his first wife (a distant cousin); his son and a daughter are now in their

20s. His daughter Reem's extravagant wedding a few years ago, held at the ballroom of the Four

Seasons Hotel Riyadh, was the talk of town. Transforming the ballroom into the lush setting for the

wedding apparently took weeks; a clip of the scene, taken on a cellphone, even made it to YouTube.

Alwaleed became a grandfather last summer when both his son and his daughter each had their first

child. One night while I was there, his daughter Reem came to the palace after dinner with her baby.

The prince was clearly besotted with his adorable little granddaughter, kissing her and bouncing her on

his knee.

The prince leads a very disciplined life. Each night he stays up until 4 a.m or 5 a.m., and sleeps for just

four or five hours. The office hours at Kingdom Holdings, his investment vehicle, run from noon to 6

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p.m. Around 8 p.m., the prince has what he calls lunch but what feels like dinner: a lavish buffet was set

up outside in a different location each night, either at the palace, the resort or, on weekend nights

(Wednesday and Thursday nights in Saudi Arabia) at his desert retreat.

He is practically addicted to text messaging. His phone is always at hand, and while I was there he sent

text messages even while taking a bike ride and, out in the desert, while he was driving a big Suburban.

His other near addiction: watching business news. During dinner each night, large flat-screen TVs were

turned most often to CNBC.

Business news has been grim since last fall, but Alwaleed hasn't let it get him down. Stock of his

Kingdom Holding fell 60% in the 12 months through mid-February, and has fallen another 19% in the

last month, to a recent $1.03 a share in mid-March.

But on the evening of March 11, when Forbes released the World's Billionaires list, Alwaleed's office

promptly issued a press release trumpeting his success, despite his falling fortune. "Prince Alwaleed

ranked among the top 25 in 2009 Forbes Billionaires list despite global economic challenges."

When you're as rich as Prince Alwaleed, losing more than $7 billion in one year doesn't feel that bad.

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Billionaires List

I Just Can't Wait to Be King Kerry A. Dolan, 03.11.09, 06:00 PM EDT Forbes Magazine dated March 30, 2009

Saudi Prince Alwaleed is acting quite royal these d ays, hobnobbing with world leaders and aiding the poor. But he has a shrinking pot of money with which to buy public admiration.

On a hot evening last October Saudi Prince Alwaleed Bin Talal, dressed in brown ceremonial Saudi

robe and headdress, boarded his Boeing 747 at the royal air terminal in Riyadh and headed west to the

fast-growing port city of Jeddah. A few hours later he presented to his uncle, King Abdullah, a model of

plans for his most ambitious real estate project to date: Kingdom Tower Jeddah, the world's tallest

building, with an intended height exceeding 3,280 feet. Kingdom City Jeddah, a 1,750-acre residential

and commercial development, will surround the tower.

"It will be the epicenter of Jeddah. It will be a magnet," boasts Alwaleed. It will earn him a return of at

least 20% a year on his investment.

Well, that was the plan, anyway. With bank lending worldwide at a near standstill, Alwaleed hasn't yet

lined up the co-investors he needs for his 40% piece of the $10 billion project (two Saudi partners own

the remaining 60%). The timetable for completing the tower has slipped back two years, to 2016.

Alwaleed remains optimistic, sort of. "We will know in two to three months," he said in mid-February.

It has been a humbling year for Alwaleed, the Western-educated, liberal-minded prince known for his

globe-spanning investments, from Citigroup to hotels in Africa. Kingdom Holding, his Saudi-listed

investment vehicle, posted an $8 billion loss in 2008. The stock's 60% fall over the past year erased

$7.7 billion from his fortune. That leaves him with a net worth of $13.3 billion, putting him at No. 22 on

FORBES' world billionaire ranking this year, down from No. 19 last year.

Alwaleed, 54, has been making noises lately about eventually becoming king, an idea dismissed

roundly by Saudi watchers even before the financial mess. Now he has bigger problems to deal with

than royal politicking. Alwaleed, once heralded as a savvy buyer of solid stocks at bargain prices, has

been forced since January to sell off $1 billion of stocks, real estate and other assets--mostly to meet

debt obligations but also to free up cash for potential investments.

Sales of stocks last fall resulted in a $4 billion loss (out of Kingdom's total $8 billion loss). Alwaleed

gingerly explains the sales, saying they were made necessary by loan covenants with banks. "We could

have used cash, but we decided to sell some assets," he insists.

The remaining $4 billion of Kingdom's loss came from marking down to market value its stakes in

Citigroup and 14 other Western and Saudi companies, including News Corp. and the management

companies of the Four Seasons and Fairmont Raffles hotel chains. "This is going to be a tough year,

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I'm telling you. Across the board, visibility is not strong," says Alwaleed. "We hope we can break even

this year."

More asset sales are coming, in the neighborhood of $700 million, says Kingdom Holding Chief

Financial Officer Shadi Sanbar. "This is the year for deleveraging," he says. But not everything is at a

loss. In recent weeks Sanbar says Kingdom has sold chunks of real estate outside Riyadh and in

Jeddah and a stake in a hotel in Geneva for an $85 million profit.

Even at its shrunken market value of $8 billion (at $1.27 a share in mid-February), Kingdom appeared

to be priced generously, at roughly twice its probable liquidating value (given what has happened to

assets listed in the prospectus issued when Kingdom went public in July 2007). In mid-February, with

Citi's shares at $3.49, Kingdom's slice of Citi was worth a mere $623 million, down from its peak of $7.5

billion in 2000. Only 5% of Kingdom's shares trade (Alwaleed owns 94% and together his two children

own 1%).

Sanbar insists that this estimate of Kingdom's asset value is far too low, given how the company has

shifted its focus from listed stocks to real estate in Saudi Arabia, hotels in the Middle East and

elsewhere, and possibly petrochemical investments. Four Seasons has signed on 24 new hotels since

mid-2007, and Fairmont Raffles signed on 48 new hotels last year. "All those will add substantial value

to [Kingdom]," says Sanbar.

But the fall in Citi stock has surely taken some of the shine off Alwaleed's reputation. It was his initial

investment in Citicorp, as it was called in 1991, that brought him international attention in the business

world. He stepped up to buy $590 million of Citicorp preferred shares, for a split-adjusted $2.50 a share,

at a time when Citi was under pressure from regulators to increase its capital base and plagued with

difficulties in its real estate and developing-country lending. Alwaleed saw an opportunity to make

money on a solid brand. For quite a while, he did, on paper.

As Citi's stock has declined, Alwaleed has been nothing but a staunch supporter. In January 2008,

when Citi shares had fallen by 35% from their peak to $27, he bought an undisclosed sum of Citigroup

preferred shares with a 7% coupon as part of a $12.5 billion round with the Kuwait Investment Authority,

the Government of Singapore Investment Corp. and others. In November, with the stock at $6, he

announced he would buy another 1%, or $350 million, of Citi common shares.

Whoops. Late last month Citi called Alwaleed to say it would no longer pay the coupon on the preferred

shares. Like the U.S. government, Alwaleed converted the preferred shares to common; for every $3.25

of preferred par value he got one share, now worth $1.02. Says Sanbar, "[Alwaleed] is definitely not

planning to sell Citi shares. We'll wait and see what happens."

The prince, who graduated from Menlo College in Atherton, Calif., got his start with a modest house, a

$30,000 gift and a $300,000 loan from his father. He partnered first with Korean construction firms and

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then others doing business in Saudi Arabia that needed a Saudi partner, and reinvested every penny he

made.

He added more Saudi companies and some well-known North American outfits to his portfolio: Time

Warner, Hewlett-Packard, Apple, News Corp. and Motorola. The American public might know Alwaleed

best for the $10 million donation he attempted to make to New York City after the 9/11 attacks. Mayor

Rudy Giuliani returned the check to the prince because of language in Alwaleed's press release that

Giuliani believed was critical of U.S. foreign policy. "The Giuliani incident raised my stock in Saudi

Arabia and the Arab world," Alwaleed now says. "He's an expired hero. I'm still a rising star."

In Saudi Arabia Alwaleed thinks he can sell lots of housing to the country's youthful population--nearly

40% of the country's 28 million people are under 15. A law legitimizing mortgage debt (allowing lenders

to share in the downside and the upside, without pure returns of interest, which are prohibited by the

Koran) is awaiting the king's ratification and should unleash demand.

A 30-minute drive to the east of Riyadh, Kingdom Holding is building Kingdom City, a residential

community with hotels and a country club, on 4,140 acres. Alwaleed estimates it will consume $6.6

billion and up to ten years in the building. Next door on 988 acres, he is spending $80 million to build

Kingdom Oasis, a resort with a safari park, horse stables, a racetrack and a "camel zone" where the

animals can wander freely.

His most quixotic venture is fueled by his apparent hankering to become monarch. For the past 50

years succession to the throne in Saudi Arabia has gone from brother to brother. Someday that

generation will pass on. The year after King Abdullah gained the throne in 2005 he created an

"allegiance council" with 35 members who are either sons or grandsons of former King Abdulaziz, the

founder of modern Saudi Arabia. The council will pick the royal family member to succeed 79-year-old

Crown Prince Sultan, the designated successor to 84-year-old King Abdullah.

Is there a possibility that Alwaleed might someday be king? "Sure," he tells a visitor en route from

Riyadh to Cairo last fall to attend a dinner hosted by Egypt's first lady. A few days later, when asked

again during a videotaped interview, Alwaleed is more coy. "The chain of command of people who

could become king in this country is between the sons and the grandsons of King Abdulaziz. I am

among them. … I would do anything to help this country," he says. Including being king? "Each one has

a chance if it comes. I will not seek it."

That, of course, is what all good politicians say. He and his communications staff rarely miss an

opportunity to raise his profile at home and abroad. Each time Alwaleed meets with a head of state or a

prime minister (he's met with 209 over the past 36 years, but who's counting?) his staff puts out a press

release, often accompanied by a photo. He's a text buddy with French President Nicolas Sarkozy and

seven other presidents and prime ministers.

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He's not above a little discreet bragging. "I'll tell you a secret," he confides to a reporter. "I went to the

king almost ten years ago. He was crown prince then. I showed him pictures of homeless people [in

Saudi Arabia]." Abdullah formed a committee to investigate, Alwaleed says, then visited a poor

neighborhood. "The day before that, if you talked about poverty in Saudi Arabia, you were a traitor. The

next day [after Abdullah's visit was made public], if you didn't talk about poverty you were a traitor."

The photo on the back cover of the authorized biography Alwaleed: Businessman, Billionaire, Prince, by

Riz Khan, speaks volumes about Alwaleed's view of himself. He stands in front of George W. Bush,

Jordan's King Abdullah, Saudi King Abdullah, Egyptian President Hosni Mubarak and other Middle

Eastern leaders. The photo was taken at a 2003 meeting in Sharm el-Sheikh, Egypt. But in the original

photo Jordan's King Abdullah stood in front of the group of men, not Alwaleed. "Yes, the photo was

switched," admits Alwaleed when asked about it.

Saudi watchers are blunt about Alwaleed's royal future. "He doesn't stand a hope in hell of becoming

king," says Simon Henderson, an expert on Saudi succession at the Washington Institute for Near East

Policy, a think tank. "His father, Prince Talal, has a past record of criticizing the royal family, and his

mother isn't Saudi." (Alwaleed's mother is Lebanese.) Says Rochdi Younsi, director of Middle East

research for the Eurasia Group: "Alwaleed is the Donald Trump of Saudi Arabia. He may be a symbol of

success for some Saudis, but many others view him as being way too gaudy." Wahabis, members of

the religious establishment in Saudi Arabia, generally oppose his notion of reform, says Younsi.

Indeed, his open support of women sets Alwaleed apart from the more conservative Saudi royals.

Nearly 65% of the staff at his palace and at Kingdom Holding are women. Inside his offices and his

palace, women do not wear the abaya, the long-sleeved black robe and head scarf that women in Saudi

Arabia are required to wear in public. Many wear designer clothes and shoes they purchase with the

semiannual $10,000 clothing allowance Alwaleed provides.

"Some sheikhs are against me because I promote women," says Alwaleed. "I hire many ladies. I hired

the first [Saudi] woman [airplane] pilot. But the king thinks it's fine. If the king told me not to do it, I

wouldn't." Later he adds, "How can you have a country advance when 50% of the population is idle?"

The fall in his Kingdom Holding share price has put nary a dent in Alwaleed's lifestyle. His palace,

staffed by 124 people, has 420 rooms, two indoor tennis courts and several indoor swimming pools--

one surrounded by stuffed big game (including an elephant and a zebra) that he and his grown children

hunted in Africa and Australia. What he calls his "farm and resort" on the edge of dusty Riyadh is a riot

of green lawns and palm trees. The resort has five artificial lakes; a minizoo with zebras, giraffes,

gazelles, antelope, ostriches and camels; and five sumptuous residences.

Alwaleed has a meticulous system to give away money to countrymen in need. He has promised to

build 10,000 homes over ten years for poor Saudis (so far he has built 1,200). Every Wednesday night

close to 1,000 men who have been vetted by his charity arm as being in need of financial help make the

trek to the prince's desert retreat an hour from Riyadh to shake his hand or kiss his right shoulder, and

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hand him their personal request for funds. (Alwaleed puts an earbud in his ear during the hourlong

process so he can listen to CNBC.) On Thursday evenings he grants requests for funds to groups of up

to 100 women, and on Saturdays he grants funds to groups of 50 handicapped people.

He keeps a book that chronicles all his charitable activity. "Some religious extremists say to me, 'You're

an atheist.' I ain't no atheist," says Alwaleed. His lists of his charity work are his "insurance policy," he

says. "I'm ten times better than [them]."

One night the prince goes with his caravan of black GMC Suburbans to a poor neighborhood in Riyadh

to hand out envelopes with the equivalent of $800 in cash in each. He knocks on the door of one very

modest shack in which a carpet covers the dirt floor. He hands an envelope to a woman in a burka who

answers the door, then walks into the house and opens the refrigerator. All that's inside: water and

eggs. "Can you believe this? It's horrible," he says to a visitor in English. He repeats the same

sequence several times.

Nights like these, Alwaleed may be winning fans, or not. But it sure beats looking at his monthly

statements.

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Market Scan

Royal Treatment Can't Save Citi Miriam Marcus, 11.20.08, 02:10 PM EST

Prince Alwaleed revealed plans to up his stake in t he bank, but shares still headed south.

Saudi Prince Alwaleed bin Talal plans to support Citigroup by upping his stake in the bank, but news of

the modest increase may not be enough to revive weary investors' confidence.

Before the bell, Alwaleed, Citigroup's largest individual investor, announced his plans to increase his

stake to 5.0%. Alwaleed said he believes the shares are "dramatically undervalued" following a nearly

90.0% plunge since late 2006. Citigroup's market value was $34.9 billion on Wednesday--the prince

plans to invest at least $349.0 million, based on Wednesday's closing price.

But the royal backing failed to distract investors from the $20.3 billion in losses that the bank has racked

up in the past year due to the declining mortgage market and bad securities investments. (See

"Citigroup Regroups.") Citigroup's stock was down 14.22%, or 91 cents, to trade at $5.49, at midday in

New York. Shares of Citigroup have fallen 82.7% this year, and analysts expect the bank's bottom-line

losses to continue through 2009.

Citigroup was also hindered by Chief Executive Vikram Pandit 's announcement on Monday that 53,000

jobs would be cut by the end of the first quarter of 2009. (See "Citi Carves Up Staff.") Investors are

worried that Pandit's plan to cut expenses, even with Alwaleed's capital backing, won't be enough to

revitalize Citigroup. Pandit suffered a major setback last month when Wells Fargo agreed to buy

Wachovia , trumping Citigroup's bid to buy much of the Charlotte, N.C.-based bank and add to its

$418.8 billion of deposits. (See "Time Out Called In Wachovia Fight.")

"Spreads are widening on pretty much everything," said Keith Davis, a bank analyst at Farr, Miller &

Washington. "Given that backdrop, how much capital is Citi going to need to shore up its balance

sheet? I don't think anyone knows, and so the knee-jerk reaction is to sell first and ask questions later."

Citigroup, which has lost more than half of its value in November, was the top decliner among large

U.S. banks, but the carnage was widespread. JPMorgan Chase was down 11.4%, or $3.25, to $25.22,

and Bank of America was off 4.0%, or 52 cents, to $12.54, at midday.

In a year that's seen the rescue of insurer American International Group and mortgage companies

Freddie Mac and Fannie Mae , some speculated about possible government intervention.

Prince Alwaleed, who currently holds less than a 4.0% stake in Citi through his investment company

Kingdom Holding, has been buying shares of the New York-based bank, believing they are undervalued

and that it's been taking steps to improve its operations amid the ongoing credit crisis. (See "Rebuilding

Global Markets.")

Alwaleed added that he is "fully confident that Citigroup's universal banking model and global franchise

will make it a long-term winner in the financial services industry."

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The prince initially invested in Citigroup's predecessor, Citicorp, in 1991, coming to its rescue after the

bank made some losing bets on U.S. real estate and Latin America. The funding was less than $600.0

million and has earned Alwaleed billions of dollars.But the value of his holdings has fallen sharply over

the past year as Citi has been hit by the credit crisis--it raised some $50.0 billion of capital from

sovereign wealth funds and other investors, including Alwaleed himself, to shore up its balance sheet.

Citigroup recently raised another $25.0 billion through the U.S. government's bank bailout package.

The Associated Press and Reuters contributed to this article.

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THE BIN TALAL INTERVIEW Intelligent Investing with Steve Forbes

2010 Will Be Better Steve Forbes: Your Highness, thank you very much for joining us. You've indicated you're more optimistic about 2010 than last year. What gives you cause for your optimism? Prince Alwaleed Bin Talal: Well, I mean, you know, the world went through a major economic recession. Thanks God, it was not a depression. It was on the verge of being a depression the last two years plus. But we are seeing in many of our businesses is that the worst is over. Although the economy's not picking up dramatically in the United States and other regions in the world, but still, we are not seeing things worsening. So, the fact that things aren't worsening, and just beginning to slightly improve, just in itself, it gives an indication that hopefully we're stabilizing. Forbes: In the Middle East, in the Gulf States, other than Dubai, have they held up fairly well during the downturn? Bin Talal: Yeah, right, excluding Dubai, all the Gulf region has really faired very well in this recession and downturn, really. Because you know, the price, we're still a very much oil-based countries, and the GCC, the Gulf Corporation Council countries, are really very much oil-based still. And the price of oil around $80, so really they have withstood the heat of the recession very, very substantially. Forbes: Eighty dollar oil makes life look a lot better. Bin Talal: No doubt, yes. Forbes: What is your bold prediction for 2010? Bin Talal: Well, you know, it's difficult for me to predict, but we always hope that the economic numbers in the United States, and other parts of the world that will stabilize and, you know, be above 50%. We're seeing the United States have some positive GDP growth, but still unemployment is still stubbornly very high -- 10%. And some people think that it's more than 10% if you add those who stopped looking for employment. So it could be over 15, 16%. So that's a very high number in the United States. Forbes: You are very well informed about the United States.

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Bin Talal: I am. I'm fully invested here. The Honeymoon's Over Forbes: Do you, on Citigroup, what brought you in originally, and where do you see it now? Bin Talal: I invested in Citigroup in 1991 when the bank was savings, basically, at that time. And the investment blew up substantially. But then, as you know, it faced all these big crises in the past two years. And then we invested again, besides some sovereign funds – Abu Dhabi, Singapore and the Kuwaitis -- we invested a huge amount also. And then we converted at a relatively low price, at 3.25, the exact same price that the government converted for. Forbes: Right. Bin Talal: So right now we hope that the worst is over, and I met Vikram, and I told him that, you know, "The honeymoon is over now, and 2010 has to be the year whereby you begin showing the world that you are a force to be reckoned with. And get back Citigroup's name to where it was pre 2007 crisis." Forbes: How hard did he gulp? Bin Talal: Well, you know, so far, Vikram has really been executing very meticulously since he took over at the end of 2007. But I told him,"The honeymoon is over right now." So he had two years, two, three years of honeymoon. But I think now, you pay TARP. The worst of the economic crisis, the worst of the credit crisis behind you. The exposure of Citibank in the commercial – Forbes: Real estate. Bin Talal: Is minimal, and the commercial debt is very minimal. So the only real issue that they have right now is the consumers, and more specifically, the mortgage. So, and they are monitoring the unemployment number very closely because it's very much that linked to the delinquency rates that may affect, negatively or positively, Citibank. Forbes: Are they going to have any major initiatives in 2010 or is it going to be more trying to grow what they have? Bin Talal: You know, I think the growth will be organic in Citibank. But the big issue right now is how to unload old assets in Citi Holding, which is really the bank that they want to get rid of. That's where all the controversial and noise-making assets are parked in. Forbes: Seems if they had not done, though, that expansion 10 years ago, it would've been in much better shape today.

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Bin Talal: Well, I mean, at that time the one-stop shopping was the model. Forbes: Right. Bin Talal: And it clearly backfired. And frankly speaking, right now they're going back to the pre-merger with Travelers, whereby you're going back to bread and butter, elementary, 101 business of being Citibank, and taking all of those extra things that really caused Citibank to be in this crisis lately. You're right. Forbes: Are you interested in other financial companies or is Citi enough for you? Bin Talal: No, no, I mean, we're invested in Citi right now because we are diversified geographically and by industry. So we're happy with Citibank right now and, you know, the average right now is 3.25, so there's the potential for this thing to grow too, and hopefully double and triple in the coming two, three, or four years, provided that the new management, headed by Vikram, delivers on its plan. Forbes: It seems a number of sovereign wealth funds invested in other banks are remembering how well you did 20 years ago. Do they still have the same faith that you have that these things can be turned around? Bin Talal: Well, it depends. For example, the Singapore wealth fund has sold half its stake, and they are back now to 5% in Citigroup. Kuwait, for example, they have exited the investment in Citi. And some other sovereign funds, they are still remaining with some British banks that they invested in during the crisis, but some of them exited. So really it varies depending on their internal situation. Media Holdings Forbes: You have some holdings in media companies, which obviously interests us. And how do you see the media world now? You have News Corp. and you also have a very large company in your region? Bin Talal: Exactly, yes. You know, we are the second biggest shareholder after the Murdoch family in News Corp, and we have smaller stakes in Disney and Time Warner and we are partners with Disney and Euro Disney in Paris. And yes, we do have a big media company in the Arab world that covers all the main region, the Middle East, North Africa region. And we have around 45% of all the movies and we have around 80% of all the music there and we are using technology to advance our causes there. We have some magazine, we have some cafes. So, yes, we're a very dominant force in the music and the movie industry in the Arab world through Rotana.

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Forbes: So what do you see ahead for media companies in the West? They've gone through a very difficult time, like some of the banks have. Bin Talal: Yes, but we're seeing now, they're coming back very strongly. And I just met with Mr. Murdoch yesterday, and he was very bullish about the future, the near future growth of News Corp. And you know, their one movie, as an example, Avatar, is going to gross more than $2 billion within two months. So and it is going to go to the bottom line, hundreds of million dollars. So, one movie, look what could happen, what it could do to one company. So News Corp really is the only really global company that's available in the five continents. And my alliance with them has been there since more than, you know, two decades. Forbes: Are there any other media companies you want to make new investments in? Bin Talal: No, I think right now I have a very strong presence in the Middle East through Rotana, and I have some business in the United States, and the globe, Europe, through my alliance with Mr. Murdoch and News Corp. And there are some more small assets here and there, but I think at this stage now, I mean, the investments in these companies, around $3, $4 billion. So we are very happy with that. The Web Changes Things Forbes: And what do you see happening with the Web, in terms of the impact on media with everything from movies to news? Bin Talal: Yeah, well, I mean, the Web has revolutionized everything. I mean, it changes the whole equation and we are seeing right now in News Corp. and some other companies would like to have the Web pay for these, for content. And still, they have not found the equilibrium point on what to do with it. Is it just, you have to pay? How much? And to whom to pay? So, this thing is an ongoing dialogue right now, but it's very interesting what's going on. Forbes: That's one way to describe it. Bin Talal: Very interesting, yes, yes. And for example, you, as Forbes, have the content. So, I mean, you're using the Web right now very efficiently, also, and I follow that very thoroughly. Euro Disney Forbes: Thank you. Well we hope to continue to expand there. What brought you to Euro Disney? Bin Talal: Well, Euro Disney, I do have a good relationship and an alliance with Disney for a long time by being an investor there. And Disney is a very good product and it covers

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all of the European region. More than 13 million people go there, so it's really very much a good attraction over there. Forbes: It's really moving ahead now? Bin Talal: Oh yes, now it's moving at full blast, 13 million visitors last year. Forbes: Are there other Disney projects you might get involved in? Bin Talal: No. Because you know, they have a presence in China right now, and they got permission to go in Shanghai, and besides, Hong Kong and Japan. No, I think, on those projects, they will do it only with certain partners. We will be satisfied to be with them in Euro Disney Paris. Hotels Are Improving Forbes: You obviously have very large holdings around the world in real estate, including the United States. What do you see for the U.S. market in real estate, particularly in hotels? You have your pulse very closely on that. Bin Talal: Oh, yes. We have many hotels. You know, I mean, we have in New York, for example, The Plaza, which is a landmark here. We are seeing the hotels coming back. They went down in 2008 and '09, but in the beginning of 2010, and the end of 2009, we're seeing the pick-up. Especially in New York in all our hotels. It did not go pre 2007 crisis, but you are seeing a stabilization, and a pick-up in Ref PAR, which is Revenue Per Available Room. Forbes: Some of them you manage, some of them you have equity in. Bin Talal: Yes. Forbes: Quite a diversified portfolio. Do you plan to expand because the prices are now more reasonable than a few years ago? Bin Talal: Our policy in the hotel business is that we own, as you know, Four Seasons brand with Bill Gates. Each one of us owns 47.5%, and the rest is Mr. Issy Sharp, the founder. And we own the Raffles and the Fairmont and it has under it a Swiss hotel we own, the Movenpick brand. And some hotels we are invested in the real estate and some of them we just manage. For example, The Plaza in New York, we own 50% of it and we manage it. Some of the hotels we don't own, but just manage it. So, all in all, we own 300 hotels in the world between management, or partial ownership, or full ownership. Forbes: Are you going to be expanding that?

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Bin Talal: Well, we're always looking for opportunities. For example, we have a fully fledged company, a publicly held company in the Middle East that goes for assets, acquisition of assets in the southern hemisphere. It's Latin America, Africa, Middle East, and Asia. So, yes, it's time to buy now. Saudi Arabian Real Estate Forbes: It would seem to be a good time to buy. You have two major projects going on in Saudi Arabia. Bin Talal: Yes, yes. Forbes: Huge. Bin Talal: Yes, we have two major real estate projects. They're transformational. One in Saudi Arabia -- one in Riyadh. It's around 12,000 villas – it will be a city within a city with around 50,000 inhabitants with total investment around 25 billion riyals. We have another project in Jeddah that’s transformational also. We're going to have the highest rise tower over there. And we're going to have a lot of, you know, developments. Because they did not get any big huge transformation development in real estate since the last two decades. So it's the project that's been backed by the government, and it's going to be a very unique project. Forbes: On the projects, the financing is going to be there now? Bin Talal: Yes, the financing. Financing is going to come through several parts. You know, equity, number one, obviously, and the equity of the real estate. Number two, they're going to have Islamic funding. We're going to have debt from banks and we're going to have contracted financing. So we're going to have the combination of five kinds of financing, not depending on one source only. Forbes: Now, in Saudi Arabia, has the mortgage law been changed so that people can more easily buy housing now? Bin Talal: You're very well informed. Unfortunately, the mortgage law did not come in Saudi Arabia yet. It's now at the final stage of being approved, has been discussed between the Council of Ministers, and the Shoura, which is our parliament equivalent. And we hope it's going to come imminently, and there's going to be a big move for our research projects. We're betting on that. Forbes: Because you have, the population in Saudi Arabia is very young. Bin Talal: Yeah, exactly. Forbes: What is it, 50% is below?

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Bin Talal: Seventy percent below 22, and the population growth is around 3.4, 3.5%. Forbes: That's one of the highest in the world. Bin Talal: And Saudi Arabia is one of the rare countries whose supply is way, way below demand. I mean, we need bigger supply to really, to absorb all the demand. So demand is very high and supply is still not much, because we're not having the mortgage law yet. Forbes: It's too bad Dubai couldn't send its real estate to Saudi Arabia. Bin Talal: What I would have done, I'd have moved all those people working in their tower to Jeddah. We have sent all those people, who were go, get the experience, knowledge, know how in Dubai, and they would move to Jeddah to build our tower. That it will be somehow a little bit taller than theirs. Forbes: How much taller will it be? Bin Talal: Well, it going to be a minimum 1,000 meters. Theirs is around 828 meters. Forbes: Do you have a projected date yet when this might be? Bin Talal: Yes, it's going to be around 4 1/2 to five years. Forbes: Wow. Bin Talal: Yes. Real Estate Funding Forbes: And in terms of other real estate in, whether it's Western Europe, London -- Bin Talal: Oh sure, in London we have Canary Wharf. You know, we were the partners of Reichmann, you know, at 10 years ago when we invested there with him. So, we have Canary Wharf, and obviously, we have a lot of scattered hotels in Europe, such as, for example, our hotel in Duburg and Geneva, and George V in Paris, Savoy in London, the Grand Hotel in Monte Carlo. And we have, and these are ownership, owned hotels, to a certain extent. But other hotels we just manage. So we come into real estate through management of hotels. Forbes: And in terms of attracting, you've mentioned the two projects that you feel the funding has been lined up for those. Do you feel in real estate in the United States, not to mention London or Western Europe, are the purse strings opening up again or is still too early?

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Bin Talal: No, on real estate, it's still too early. Banks are very hesitant to talk or even discuss nature of real estates. Yes, it's very early. They're very worried and concerned about it. Forbes: Did you get a sense, when you talked to Vikram and others at Citigroup, that they're becoming more open to lending? Because while the president here says, "Lend," our auditors and regulators go in and say, "Tighten up your lending standards, increase your capital." Two opposite messages. Bin Talal: Banks are very cautious, very conservative. You know, it's like having a guy just leaving intensive care unit, ICU. He's never going to run and jog. He's going to walk very slowly and then walk a bit faster. So, no, no, they're not lending. They're very conservative, regardless of what orders they get from Washington. Forbes: Now in looking at the Gulf states, other than Dubai, do you feel that the young people are, especially in Saudi Arabia, finding opportunities in the region? Or do you think more development has to be done? Bin Talal: Well, in Saudi Arabia we have a new plan to employ as many Saudis as possible, and with Saudi men or Saudi ladies. And with the growth that we have right now at around three or four percent, so we're able to absorb some of those new graduates from school and universities. But you have to understand in Saudi Arabia you have an imbalance, whereby you have six million expatriates who work in Saudi Arabia, yet to have two, three million unemployed. So a plan is needed totally to try to eliminate as much as possible of those jobs that are being filled by expatriates and have them filled by Saudi nationals, whether they be men or ladies. Forbes: And you've been a pioneer in employing ladies, employing women. Bin Talal: Yes. Forbes: Are others following your good example? Bin Talal: You know, we have taken a decision almost five years ago to really employ ladies. And I tell these ladies, "I'm not employing you for your own sake. I'm employing you for the sake of Saudi Arabia and then for your own sake." Because when Bill Gates came to Saudi Arabia, and he came publicly and said, "Any country that does not employ around 50 percent of its population," which he means is referring to ladies here, "cannot really advance and have a good cause in economic development." And I told him, "Thanks a lot for saying that." I believe that right now we are the vanguard there, and many companies right now are beginning to hire Saudi ladies, and beginning to incorporate them and assimilate them in the system, economically, and even in the political arena. Like, for

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example, some ministers are beginning to hire some ladies, also. We're pushing very hard for that. Finding The Next Apple Forbes: Good, good. You're obviously a major global factor, as you've mentioned in the media, in real estate, financial services. Are there other areas you're looking at to make a major push in the next few years? Bin Talal: Well, yes, I mean, look, we are financial investors. I mean, besides real estate domestically and internationally, hotels, regionally and internationally, real estate, hotels, we are invested also in technology, for example, in Apple computer. We are in media also. Forbes: You made a very good investment there. Tell us, in 1997, you made an investment. What was the equivalent per share? Bin Talal: We entered at around $9.50. Forbes: And it's now over $200? Bin Talal: Yes, yes, yes. That was a home-run investment, no doubt. Steve Jobs is a genius, and at that time, you know, Apple was down, but was not out, and history proved that. Forbes: Do you have any other Apple-like recommendations? Bin Talal: Well, I mean, it's a bit too late to get in Apple right now, because really. Forbes: But what's the next Apple? Bin Talal: Well, we're looking. I mean, we don't see anything right now, really, that's really very lucrative, frankly speaking. But I'll call you, for sure. And you call me if you have some good deals, also. Forbes: Good, well, we'll make sure our viewers see it as well. Bin Talal: Sure. Forbes: Your Royal Highness, thank you very much. Bin Talal: Always a pleasure to see you, Steve, a good friend. Forbes: Good to see you. Bin Talal: Thanks a lot.

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Forbes: Thank you.