Businessweek Archives

Apple's Prince Charming


In Business This Week: HEADLINER: PRINCE ALWALEED

APPLE'S PRINCE CHARMING

After shunning high-tech stocks during their years of white-hot growth, Saudi Prince Alwaleed bin Talal bin Abdulaziz al Saud has taken an interest in Apple Computer. On Apr. 1, he announced that he had quietly bought $115 million of Apple stock over the preceding month, giving him a 5%-plus stake. He indicates he may buy more, too.

The prince has done very well with out-of-favor companies: He has made over $3 billion on Citicorp shares bought in 1991, and stakes in Euro Disney and Canary Wharf have paid off big. He may already be ahead on Apple: On Mar. 27, Oracle CEO Larry Ellison told a newspaper he was mulling a bid for the company. That sent Apple stock up 1 7/8, to 18 5/8. Alwaleed says the two billionaires have not talked, but he notes, "Ellison is respected, and I admire him. But when I began picking up Apple, I didn't even know he was going to bid."

The prince, 40, is typically a passive investor. And as part-owner of the Four Seasons hotel chain, he's busy building hotels in nearly a dozen Arab cities.By Peter Burrows and John Rossant EDITED BY KELLEY HOLLANDReturn to top

WHEN YOU WISH UPON A STARWAVE

WHEN IN DOUBT, BUY 'EM OUT. With Rupert Murdoch and others eyeing investments in Internet ventures, Walt Disney has decided to go first. Disney is buying into Paul Allen's Starwave in a deal that could give the entertainment conglomerate full control of the new-media content company that runs nine sports- and entertainment-related Web sites. Paying an estimated $10 million, Disney is buying about a 5% stake in Starwave, with options to buy out Allen's controlling stake within five years. Disney will also take over Starwave's operations and control the seven-person board. The two companies are already in business together: Starwave and Disney's ESPN unit jointly created ESPNET SportsZone. Disney's ABC unit is also in league with Starwave: Along with America Online and Netscape Communications, they're planning to launch ABCNEWS.com, a 24-hour news service.EDITED BY KELLEY HOLLANDReturn to top

A TEXAS BARBECUE OF KAISER?

KAISER PERMANENTE, ONE OF the nation's largest health-maintenance organizations, could soon face a crackdown in Texas, where it has about 130,000 members. Attorney General Dan Morales says there are "sufficient grounds" for revoking the HMO's license. A Texas Insurance Dept. report critical of the HMO's care was recently sealed after Kaiser won a state court order. But a state insurance official testified on Apr. 1 that state auditors are alarmed by complaints the agency has received about Kaiser's emergency care and the number of wrongful-death suits against the HMO. Kaiser calls the sealed report "very shoddy."EDITED BY KELLEY HOLLANDReturn to top

ANOTHER REORG AT DIGITAL

THE RETURN TO HEALTHY growth and robust profits is still not happening at Digital Equipment. Analysts now say earnings for the quarter just ended should be just $37 million, a 70% drop from a year ago, signaling Digital's third lackluster quarter in a row. Revenue should come in around $3.3 billion, down 9% from a year ago. The company is trying yet another reorganization. Bruce Claflin will now head up a streamlined sales and marketing organization. But meanwhile, sales of Digital's Alpha computers are limping along at single-digit growth rates, despite discounts that are hurting profits, distributors say.EDITED BY KELLEY HOLLANDReturn to top


Burger King's Young Buns
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

 
blog comments powered by Disqus