Saudi’s UK investment drive goes full throttle

Influence: Saudi Arabia is controlled by de facto ruler Mohammed bin Salman

When Aston Martin teamed up with California-based Lucid motors last month to develop a range of electric cars, it was billed as James Bond’s favourite car brand joining forces with a cutting-edge Silicon Valley tech group.

But it was much more than that.

If you looked under the bonnet, closer inspection revealed the not-so-hidden hand of Saudi Arabia, one of the world’s largest exporters of oil and natural gas.

Lucid is majority-owned by the Public Investment Fund, the sovereign wealth arm of the Saudi state, which is responsible for channelling billions of pounds’ worth of fossil fuel money into projects and companies around the globe.

The PIF is estimated to manage assets worth more than £500 billion and is chaired by Saudi Arabia’s de facto ruler and prime minister, Crown Prince Mohammed bin Salman of the ruling Al Saud dynasty, who is commonly known by his initials, MBS.

The PIF is also the second-largest investor in Aston Martin, with an 18 per cent stake worth around £450 million. It is the latest move by the ultra-conservative Kingdom to use its vast piles of cash to expand its economic influence in Britain, following the lead of other Gulf states, such as Qatar, which have poured oil wealth into the UK.

Aside from its stake in Aston Martin, the PIF also has holdings in cruise ship firm Carnival. But arguably, its most controversial moves have been in the sports world.

In 2021, it raised eyebrows when it swooped on Premier League football team Newcastle United, buying the club from its former owner, Sports Direct tycoon Mike Ashley.

The Saudi consortium was aided by British businesswoman Amanda Staveley, who is known for her connections with Middle Eastern investors. But the takeover was marred by allegations of sportswashing, a practice where regimes with questionable human rights records use professional sports to rehabilitate their images.

Supporters of the takeover argued that opposition to the deal was rooted in racism and compared the uproar to that seen in takeovers of other major English football clubs by Middle-Eastern backers.

The country’s influence in the sporting world was thrown back into the spotlight last month when a proposed merger between the Saudi-backed LIV Golf tour and the US PGA Tour sparked international outrage from activists and some of the sport’s biggest names.

Connections: Amanda Staveley helped the PIF to buy Newcastle Utd

The Kingdom also signed a ten-year deal with Formula One to host Grand Prix races, and is also thought to be aiming to hold the football World Cup in 2030 in a manner similar to last year’s tournament in Qatar. 

Riyadh’s scramble into the professional sports world is part of a charm offensive that many consider an effort to launder the country’s reputation and obscure its bleak human rights record and draconian laws. Among these is same-sex activity being illegal and punishable by death, although the law is not always enforced, and severe restrictions on women’s rights.

MBS is also thought to be trying to mend fences following the 2018 assassination of journalist and democracy activist Jamal Khashoggi by Saudi agents inside the country’s embassy in Turkey.

‘The way the Saudi authorities are using their sovereign wealth fund shows it isn’t just a straightforward vehicle for state investment – it’s also a tool for state-level image management,’ said Peter Frankental, economic affairs director at Amnesty International UK.

He added: ‘Saudi Arabia’s purchase of Newcastle United was a spectacular act of sportswashing, and the strategy with Aston Martin can be seen as an aligned approach, with the country attempting to absorb the prestige of the brand and even gain a little of the lustre from its association with James Bond.’

The kingdom’s investments abroad are also proof of its drive to diversify its economy away from oil. But while there are opponents to the influx of Saudi cash, there is a complicating factor: the PIF has deep pockets and the potential to help fund long-term investments that Britain desperately needs.

Licence to thrill: Daniel Craig as 007 with an Aston Martin sports car

Huge infrastructure projects, such as the Sizewell C nuclear power plant, are likely to need funding from sovereign wealth funds and Ministers have been wooing Gulf states to drum up support, The Mail on Sunday understands. 

At present there seems to be no sign that the flow of Saudi cash will stop pouring in, with the country having benefited from the recent surge in global oil prices after Russia’s invasion of Ukraine. 

A Government spokesperson said: ‘Saudi Arabia is our largest trading partner in the Middle East and we have long-standing relationship based on a range of strong mutual national interests, including bilateral investment. We’re also working on a free-trade agreement with the Gulf Cooperation Council, which will support the Government’s priority to boost the economy, create jobs and increase wages.’ 

Beyond the Saudi state’s own investment, Saudi investors, like many of their counterparts in countries such as Qatar and the United Arab Emirates, are becoming increasingly interested in the UK’s lucrative property market.

Turki bin Salman Al Saud, the ninth son of Saudi King Salman bin Abdulaziz, is reported to own nearly 20 properties in London through Moncrieff Holdings, a firm based in the British Virgin Islands.