The history of Spanish democracy is almost the history of the impact of the petrodollars in our economy and our businesses. For historical and cultural reasons, relations in the 20th century between the countries of the Persian Gulf and Spain have been very fluid. Beyond the murky relations of Arab money with political and institutional power, the official landing of petrodollars took place in the mid-1980s, in full economic liberalization by the Government of Felipe González. These first investments later gave way to fruitful relations between the large Spanish business groups. An example of this is the long relationship between Cepsa and Mubadala, the sovereign wealth fund of the United Arab Emirates, which entered the capital of the company in 1988 as a minority shareholder. Or more recently Qatar’s investments in companies like Iberdrola. The Qatari investment arm also maintains stakes in emblematic companies such as the Prisa group or El Corte Inglés. To which is added from this Wednesday the 2,100 million with which Saudi Arabia will enter the capital of Telefónica. All these investments add up to 16,577 million euros.
Back in the 1980s, the Kuwait Investment Office (KIO), the investment arm of the Kuwaiti government, took control of the Catalan company Torras Hostench, to which were added purchase operations such as Cros, the Ebro sugar company or Explosivos Río Tinto, which merged with Cros and gave rise to the Ercros holding company. The architect of this dizzying growth, which turned the KIO Group at the beginning of the 90s into the largest industrial conglomerate operating in Spain, was the financier Javier de la Rosaa man of the total confidence of the Kuwaitis and one of the decisive characters in that Spain of the culture of the ball.
It has rained a lot since the days of KIO, but the money from the Persian Gulf has positioned itself among the main Spanish groups. Although BlackRock is currently one of the major shareholders of the Ibex, adding investments close to 20,000 million euros, Arab money has also carved out an important niche among the flagships of the companies spanish. Qatar Investment Authority, directly or through other companies, accumulates up to 9,000 million in the Ibex 35. The sovereign fund has been a shareholder since 2011 of Ibedrola, the largest listed company on the Ibex, and currently holds a position of 8.7% of the capital, and that it has a value of 6,106 million euros. Qatari money is also present in the shareholding of other large Ibex companies such as the Colonial real estate company (19%), which is equivalent to a value of 570 million, and the Spanish-British group IAG (25%), valued at around 2,359 million.
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Other investments made with Qatari money in emblematic companies are those of El Corte Inglés and the Prisa group. Sheikh Hamad Bin Jaber al Thani came to own 11.07% of the capital of the department stores, although the Spanish group agreed to pay around 387 million euros to buy back 5.53% in June 2022. In the case of the In the Prisa group, Qatari royal family member Khalid Thani Abdullah Al-Thani retains a 4.91% stake in the capital, which is equivalent to around €19 million based on Prisa’s current value. Indirectly, the Qataris also maintain hotel investments, especially in Barcelona. Qatar Diar came to pay up to 200 million euros for the W hotel. In 2014, Marriott sold the Renaissance hotel in Barcelona to the Qatari Army fund for 78.5% million euros.
Outside of the main companies of the selective, the investment arm of the United Arab Emirates, Mubadala, maintains a 3% stake in Enagás, which is equivalent to about 123 million, according to the current market value of the company. The Emiratis also control the shareholding of the energy company Cepsa. They came to own 100% of the capital, but in 2019 they sold 37% to the Carlyle fund for about 2,900 million, so the Saudi participation in the energy company would be equivalent to 4,900 million euros taking into account that market price.
Kyo’s fall
The moment of greatest media impact for KIO and Javier de la Rosa came at the end of the 1980s, when through Cartera Central, one of their investment subsidiaries, they dynamited the merger project of the then large Central banks (where they controlled more than 25 %) and Banesto. A union that in a few months would have brought a then very young (barely 40 years old) Mario Conde to the top of the big Spanish banks.
KIO’s story was as brilliant when it landed as it was when it fell. Its top manager in Spain, Javier de la Rosa, accused of embezzlement and fraud by the Saudi authorities themselves, was fired in 1991 and in 1992the Torras Group presented what was then the largest suspension of payments in the history of Spain, with a liability of 243,000 million pesetas, which in exchange would be a now derisory 1,500 million euros.