Meet the Saudi sisters wielding $75 billion in a man’s world

A U.S.-based representative for Olayan Group had no comment and referred all requests to a Saudi-based spokesman, who did not respond to a detailed list of questions.

Most global executives are hesitant to talk about family for fear of offending sisters who are known to be fiercely protective of their privacy. This story is based on analysis of the family’s investments, operating companies and family business filings, as well as interviews with more than a half-dozen people who knew the group and asked not to be named discussing nonpublic information.

Wall Street bosses

Hutham and Lubna, both in their early seventies, were born in Saudi Arabia to Suliman Olayan. Patrik was orphaned at a young age and, taking advantage of his fluent English, began working as a dispatcher for the previous company, Saudi Aramco. He mortgaged his house for $8,000 to win a pipeline contract A profile in Time magazineHe founded Olayan Group in 1947.

From there, Suliman diversified aggressively and the group continued to form partnerships to sell Colgate toothpaste, Oreos and Coca-Cola in the kingdom. He bought U.S. stocks to use as loans in American banks, and his holding had annual revenues of more than $300 million in 1980, according to his Time profile.

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His globalist bent created a unique binational empire into which his daughters were immersed at an early age. They both studied in the USA and when they returned, they took important jobs in the family business. Following Suliman’s death in 2002, his son Khalid became chairman of the Olayan Group, but Lubna and Hutham helped run most of the family’s extensive operations.

Hutham assumed responsibility for Olayan America, while Lubna led the Middle East-focused division. The sisters married foreigners and took on important roles; lubna First woman elected to the board of directors of a public company in Saudi Arabia In 2004. Even then, women’s rights were severely limited in the kingdom. Women were finally given the right to drive only in 2018.

low profile

In a 2018 interview with NPR, Lubna recalled the difficulty of finding women’s restrooms in factories and meeting rooms because there were often no women present. She began approaching government officials and executives for help in increasing the female workforce; In the meantime, he was reminded to proceed with caution and avoid conflict.

“So you negotiate, you agree, you do this, you take and you give,” he said in the interview about these initial efforts.

Meanwhile, the sisters gained a reputation as determined negotiators. Their rise was aided by their ability to keep a low profile, and the duo ensured that their business was seen as supportive of the government’s aims.

The group is now officially headquartered in Liechtenstein and has offices worldwide. including AthensWhere Lubna’s lawyer husband has deep ties. Over the years, the family has gained a reputation for running a highly professional organization with a level of sophistication in doing business not seen in family offices.

“The family was very conscious of incorporating corporate governance frameworks into their business, and they did so with a high level of professionalism,” said Josiane Fahed-Sreih, Director of the Family and Entrepreneurship Institute at the Lebanese American University.

In a sign of their influence, the Olayan family was left untouched in 2017 when dozens of Saudi royals, former officials and businessmen, including Alwaleed, were detained at the Ritz-Carlton in Riyadh as the Crown Prince consolidated his power and carried out an unprecedented national shakeup.

Investment misstep

Alwaleed, now worth about $17 billion, has made something of a comeback in recent years, and the investment group has benefited from the kingdom’s construction spree. The businessman, known for his flamboyant lifestyle in the 1990s, was often photographed on a private yacht purchased from Donald Trump.

Odds are doing things differently.

“We don’t normally stay in the spotlight… especially anything flashy,” Hutham said of the Olayan family in a speech to the Arab Bankers Association of North America in 2013. “We avoid excess and are pretty frugal.”

Despite this, wrong steps were taken in investments. These longtime investors in Credit Suisse stuck by the bank even through the crisis, becoming one of the biggest losers in the turmoil that ultimately resulted in UBS Group buying the troubled lender at a discount.

The losses were large enough to shake major financial firms, but one international executive recalls that the collapse was treated as a relatively minor event within the Olayan Group. The person in question said that the holding continued to carry out its transactions and payments normally throughout the period.

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The Swiss bank’s largest shareholder, the Saudi National Bank, was among the companies that lost money on its investment, and its chairman subsequently resigned. Meanwhile, the Olayans’ profile has only increased in the years since.

Key to this are its relationships with Wall Street and within the kingdom, especially as Riyadh begins to intensify pressure on foreign firms to invest more locally and help diversify the economy.

Despite recent financial pressures, Saudi Arabia remains a lucrative market for global financial giants: Riyadh has been one of the biggest debt issuers in recent years, while the kingdom’s wealth fund appears to have an appetite for blockbuster deals such as the recent $55 billion transaction to privatize Electronic Arts Inc.

Lubna has close connections to BlackRock co-founder Larry Fink, among others, and was recently named co-chair of the US-Saudi Business Council alongside Citi’s Fraser. Hutham sits on the board of Brookfield, one of the Middle East’s largest private equity investors.

Davos in the desert

This year, during this time Saudi Arabia’s Future Investment Initiative conferenceLubna, often referred to as Davos in the Desert, hosted a party in Riyadh where top global financial executives and officials mingled over canapés, rice and lamb, according to one attendee.

Its connections are wider than finance. Their father’s US capital investments, which he began accumulating in the 1960s, reached US$12.7 billion. These days the portfolio includes shares in Microsoft, Alphabet and Amazon. By comparison, Saudi Arabia’s US$1 trillion wealth fund owns just over US$19 billion in US equities.

The group’s private equity portfolio makes up another big piece and is estimated to run into tens of billions of dollars, according to people familiar with the matter. According to the website, the compound annual growth rate of direct investments exceeded 30 percent in the 10-year period. The firm’s real estate assets cover more than 40 million square meters and consist of 40,000 apartments under management.

The Otanians supported the kingdom’s greatest efforts in their own country. As Saudi Aramco’s $25 billion IPO struggled to attract international investors in 2019, the Olayan family was among those tapped locally by MBS management (as the de facto ruler is called) to support demand.

At the same time, the sisters managed to maintain a careful balance in their public statements. In 2018, as much of Wall Street avoided the kingdom’s FII conference after Saudi agents killed columnist Jamal Khashoggi, Lubna used the beginning of a panel discussion to mourn his death, saying the action went against Saudi values.

“We are grateful that the horrific acts reported in recent weeks are foreign to our culture and DNA,” Lubna said in her speech.

These days, Lubna serves as corporate chairman of the Olayan Group, according to a recent press release from the US-Saudi Business Council. The group’s website states that Hutham chairs the shareholders’ board.

Day-to-day operations are mostly run by people like Chief Executive Hani Lazkani and Chief Operating Officer Samer Yaghnam, but the sisters remain the public face of the group and manage broad strategy with family members, people familiar with the matter said.

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Many people described Lubna as an outspoken and outgoing person who was known for being deeply involved in her investments. James Zogby, president of the Arab American Institute and a friend of the late Suliman, said he was worldly and warm-hearted like his father, but also sharp-sighted. “If you talk to him about current events, it’s not just, ‘This happened.’ He understands why things are going the way they are.”

Hutham, meanwhile, appears soft-spoken and grandmotherly in conversation, but for an international manager, her gentle questioning style can reveal small details that could serve as fodder for the negotiating table.

The sisters are among the few who fully understand the true extent of their growing business and keep a tight grip on its financial details. There have been moments in recent years when listing an operating business seemed imminent but deals did not materialize.

Meanwhile, much has changed for Saudi women in the workforce. Over the past seven years, the kingdom has announced reforms to allow women to start businesses and travel independently without men’s consent, and many now manage private equity funds, trade stocks and work in factories.

“Even in adversity, we look for opportunities,” Hutham said of his family in 2013. “We see the silver linings.”

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