Skip to main content
MENU
Subscribe
  • Subscribe
  • Account
  • LOGIN
  • Topics
    • Alternatives
    • Consultants
    • Coronavirus
    • Courts
    • Defined Contribution
    • ESG
    • ETFs
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Opinion
    • Partner Content
    • Pension Funds
    • Private Equity
    • Real Estate
    • Russia-Ukraine War
    • SECURE Act 2.0
    • Special Reports
    • White Papers
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • Eddy Awards
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • Climate Change: The Inescapable Opportunity
    • Impact Investing
    • 2022 ESG Investing Conference
    • ESG Rated ETFs
  • Defined Contribution
    • Latest DC News
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • Trends in DC: Focus on Retirement Income
    • 2022 Defined Contribution East Conference
    • 2022 DC Investment Lineup Conference
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Performance Data
    • P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
    • Future of Investments Research Series
    • Charts & Infographics
    • Polls
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
    • 2022 Innovation Investing Conference
    • 2022 Defined Contribution East Conference
    • 2022 ESG Investing Conference
    • 2022 DC Investment Lineup Conference
    • 2022 Alternatives Investing Conference
Breadcrumb
  1. Home
  2. ALTERNATIVES
March 26, 2019 01:00 AM

Hedge fund is said to spurn Saudi Arabia's cash after journalist's murder

Bloomberg
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print
    Bloomberg
    Mohammed bin Salman, Saudi Arabia's crown prince

    A hedge fund has told investors it returned money to Saudi Arabia following the murder of columnist Jamal Khashoggi, according to people with knowledge of the matter.

    The move is a rare rebuke to one of the world's most influential investors. Pharo Management (UK) in December gave back about $300 million that it had previously managed for the kingdom's central bank Saudi Arabian Monetary Authority, known as SAMA, one of the people said, asking not to be identified because the information is confidential.

    Guillaume Fonkenell, 54, who founded Pharo, told some investors in January that the decision was made to uphold its principles due to concerns about Mr. Khashoggi's death at the hands of government agents last year, the person said.

    The move highlights lingering disquiet about Saudi Arabia's human rights record under Crown Prince Mohammed bin Salman, whose ambitious plans for economic redevelopment have been overshadowed by allegations since October that he engineered the writer's brutal killing in the kingdom's Istanbul consulate. The heir to Saudi Arabia's throne, who is often referred to as MBS, still has the crucial support of President Donald Trump, and most Wall Street firms and a number of nations have chosen to continue doing business with the wealthy kingdom despite widespread condemnation of the murder.

    Saudi authorities deny the prince played any role in Mr. Khashoggi's death.

    A spokesman for Pharo, which managed $9.7 billion at the end of January, declined to comment. A representative for SAMA, which acts as the custodian of the kingdom's foreign reserves, didn't respond to several calls and emailed requests for comment.

    Investor pullback

    Saudi Arabia's state-owned investment firms — flush with cash and eager to generate returns that will help offset the impact of depressed crude prices on the oil-rich economy — are one of the biggest sources of capital for asset managers globally. While top financiers including J.P. Morgan Chase's Jamie Dimon, BlackRock's Larry Fink and Winton Group founder David Harding pulled out of the prince's flagship investment event in October, their message was dimmed when less-senior executives participated in the conference.

    Mr. Fink said in November that he wasn't "ashamed" of doing business in Saudi Arabia and expects to continue to invest in the country.

    In December, the Massachusetts Institute of Technology said in a report the school should maintain relations with Saudi Arabia despite concerns around the murder that sparked outrage on campus.

    Other companies have attempted to penalize Saudi Arabia following Mr. Khashoggi's death and dismembering.

    British billionaire Richard Branson suspended talks with Saudi Arabia's Public Investment Fund shortly after the initial media reports about the columnist's disappearance, calling it a potential game-changer for companies doing business with Saudi Arabia. The sovereign wealth fund had committed to investing $1 billion in space companies controlled by Branson's Virgin Group. Talent agency Endeavor also sought to terminate a deal to sell a $400 million stake to PIF.

    Pharo is potentially the first hedge fund to go to the extent of refusing to manage money for the country. The decision comes at a time when the $3 trillion industry finds itself engulfed in a fierce battle to attract capital as investors revolt against high fees and mediocre returns. Clients pulled out $37.2 billion from hedge funds in 2018, according to eVestment data.

    PIF, the most well-known of Saudi Arabia's sovereign wealth funds, has made a series of investments in companies such as Tesla and Uber Technologies, as well as a $45 billion commitment to SoftBank Group's Vision Fund.

    Until recently, Saudi Arabia invested the bulk of its surplus through the central bank. Net foreign assets held by SAMA were over 1.8 trillion riyals ($480 billion) in January.

    Related Articles
    Stringer urges index providers to exclude Saudi Arabia
    Death of journalist puts Saudi Arabia investing on hold
    Fink calls Khashoggi murder a mystery, will keep Saudi ties
    Don't shut out the Saudi market
    Saudi Aramco sells $12 billion of bonds in unprecedented debut
    Aramco's $12 billion bond deal fizzles in second day of declines
    Brunei's drastic punishment becomes ESG issue
    Saudi bourse chief sees foreign bets in market soaring by 2022
    Recommended for You
    ONLINE_170729815_AR_-1_WQFKOCKSIIXQ.jpg
    Clearlake Capital docks seventh flagship fund at $14.1 billion
    Gila Cohen
    Monroe Capital brings on managing director for institutional partnerships
    Apollo_Logo_i.jpg
    Apollo takes stake in life sciences VC firm Sofinnova Partners
    OCIO, Anchor in Rough Seas
    Sponsored Content: OCIO, Anchor in Rough Seas

    Reader Poll

    May 9, 2022
    SEE MORE POLLS >
    Sponsored
    White Papers
    Are Factors a Thing of the Past?
    Q2 2022 Credit Outlook: Carry On
    Leverage does not equal risk
    Is there a mid-cap gap in your DC plan?
    Out of the Shadows: The Revolution in Shadow Accounting
    The pivotal role of fixed income markets in the ESG revolution
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    May 9, 2022 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Content Solutions
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Consultants
      • Coronavirus
      • Courts
      • Defined Contribution
      • ESG
      • ETFs
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Opinion
      • Partner Content
      • Pension Funds
      • Private Equity
      • Real Estate
      • Russia-Ukraine War
      • SECURE Act 2.0
      • Special Reports
      • White Papers
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • Eddy Awards
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • Climate Change: The Inescapable Opportunity
      • Impact Investing
      • 2022 ESG Investing Conference
      • ESG Rated ETFs
    • Defined Contribution
      • Latest DC News
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • Trends in DC: Focus on Retirement Income
      • 2022 Defined Contribution East Conference
      • 2022 DC Investment Lineup Conference
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Performance Data
      • P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
      • Future of Investments Research Series
      • Charts & Infographics
      • Polls
    • Careers
    • Events
      • View All Conferences
      • View All Webinars
      • 2022 Innovation Investing Conference
      • 2022 Defined Contribution East Conference
      • 2022 ESG Investing Conference
      • 2022 DC Investment Lineup Conference
      • 2022 Alternatives Investing Conference