Thursday, November 14, 2024

Wall Street Giants Split Time Between Trillion-Dollar Gulf Hubs

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(Bloomberg) — BlackRock Inc.’s Larry Fink was among headliners at Saudi Arabia’s annual Davos-style investment confab in October. Days later, he popped up on a social media post from Abu Dhabi’s $1.5 trillion man, Sheikh Tahnoon bin Zayed Al Nahyan.

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The $11.5 trillion asset manager Fink runs recently received approval to set up its regional headquarters in Riyadh. It’s also teaming up with the Abu Dhabi royal on one of the largest efforts to date to bankroll the build-out of data warehouses and energy infrastructure.

The biggest firms on Wall Street operate across geographies and top executives often fly to multiple countries while visiting a region. But Riyadh and Abu Dhabi, which are competing to be the Middle East’s main business hub, offer unique opportunities: The cities control over $1 trillion in sovereign wealth each, making them among the biggest pools of capital in the world.

Sheikh Tahnoon — one of Abu Dhabi’s two deputy rulers, the United Arab Emirates’ national security adviser and brother to its president — had conversations with many executives who also spoke at the FII, according to posts on the royal’s X profile.

That list included Morgan Stanley Chief Executive Officer Ted Pick, Blackstone Inc.’s Steve Schwarzman and Ruth Porat of Alphabet Inc., which is partnering with Saudi Arabia on an artificial intelligence hub. Meanwhile, Goldman Sachs Group Inc. CEO David Solomon also dropped by in Abu Dhabi shortly after his firm announced its new Riyadh office, according to a person familiar with the matter.

The two cities have rolled out a series of initiatives in their quest for greater global relevance. Riyadh is asking international firms to boost their local presence, or risk losing business. That’s prompted the likes of General Atlantic and Goldman to beef up their operations in the kingdom.

Some others have been reluctant about making Riyadh their main hub because their employees prefer the lifestyle in the UAE. To further sweeten the deal, Abu Dhabi has also rolled out a series of perks, including a lifestyle-support program for incoming financiers.

But many firms looking to raise cash or plug into dealmaking driven by ambitious diversification programs are trying to keep a foot in both camps.

BlackRock, for instance, said its new Riyadh base will help the firm expand operations across the Middle East and not just in the kingdom. Goldman continues to have a significant presence in both Dubai and Abu Dhabi, and Barclays Plc, which is considering re-entering Saudi Arabia after a decade, said it intends to grow its team in the UAE as well.

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