It’s an expensive game, being a billionaire. We got a wonderful insight into just how expensive it really is earlier this week, when struggling billionaire Maan al Sanea appeared before the High Court in London, seeking to have $US10.2 billion of his assets unfrozen.
Al Sanea, the man behind Saudi conglomerate Saad Group, is locked in a battle with a major creditor which has accused him of fraud and frozen his assets. Al Sanea strenuously denies the allegations and went to the High Court on 6 October to try and unfreeze his assets or at least get his living allowance increased from a paltry $11,000 a year.
Al Sanea wanted his annual allowance increased to $33 million. Central to his legal team’s argument was the billionaire’s extremely high living expenses.
“He spends $US800,000 ($897,000) on electricity, gas, telephone, water and satellite bills every month,” his lawyer told the judge, according to a report in the Financial Times.
But that’s not all. “He has a zoo, my lord,” the lawyer told the judge.
It’s not clear whether the plight of the potentially-impoverished lions and giraffes in the said zoo eventually swayed the judge, but Al Sanea’s allowance was eventually increased to $4.4 million a year – enough to pay the utilities for a year, and hopefully keep a few of the animals fed too.
Al Sanea’s extravagances show that even during the worst downturn in 70 years, the rich have continued to spend up big.
Indeed, with the global economy apparently on the road to recovery, the rich appear to have decided that it’s time to open their wallets. In the last few weeks, we’ve seen some very indulgent purchases, many of which have focused on that most popular billionaire status symbol – the sporting team.
Here are a few of the best cash splashes.
Hong Kong billionaire Carson Yeung is the latest wealthy entrepreneur to buy into England’s Premier League competition, paying $140 million for struggling club Birmingham City. This is the first Premier League club to be purchased by a Chinese business person and Yeung has made much of his plans to establish strong links between the club and the lucrative Chinese market.
Canadian billionaire Guy Laliberte – he’s the founder of the extremely successful Cirque du Soleil – has spent most of the week travelling to the International Space Station in a Russian space craft, thereby becoming on the world’s first space tourists. The cost? A mere $39 million, which Laliberte says was “worth every penny”. At least it’s not all just an expensive lark. On October 9 Laliberte did a two-hour presentation to raise awareness for a clean water charity.
First the Russian billionaires made their mark on English soccer – now they are targetting American sports. Billionaire Mikhail Prokhorov, a metals baron who is widely considered the richest man in Russia, has spent around $221 million to purchase an 80% share in professional basketball club the New Jersey Nets, and a 45% share in a new stadium the team is building. Despite the club’s history of generating impressive losses, a number of commentators believe Prokhorov has got a pretty good deal – when the stadium is complete, his stake in it should be worth almost $400 million alone.
What do you get the teenager who has everything? A $5.3 million luxury yacht, of course. That’s exactly what Queensland billionaire Clive Palmer did in late September, when he purchased a 30-metre cruiser from a boat show on the Gold Coast, apparently for his daughter’s 15th birthday. Palmer’s fortune has been valued between $3 billion and $12 billion, so a little boat is hardly going to break the bank.
Staying with the nautical theme – and the Russian oligarch theme – and we have the extraordinary story of Roman Abramovich upgrade to his $1.3 billion yacht, called Eclipse. According to The Times, one of the boats features a laser-powered force field that renders digital cameras inoperable, meaning those pesky paparazzi can’t bother Roman and his guests. The yacht, which includes 24 guest rooms and two helipads, has had $560 million worth of modifications in recent months.
Late last week billionaire Thomas Ricketts finally got approval to buy iconic baseball team the Chicago Cubs for $935 million. It’s a huge investment, given the club hasn’t won the World Series title for 101 years and the seller, the media company Tribune Co., recently went bankrupt.
The US property sector is struggling and cashed up billionaires are keen to spot bargains. Turkish billionaire Turgay Ciner, who owns power plants as well as copper, aluminum and soda ash mines in Turkey, has just paid $12 million for a unit in New York’s Plaza hotel. It’s two stories below an apartment he bought in the hotel last year for $10 million.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
