Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud of Saudi Arabia, an investor in media titans News Corp. (NSDQ: NWS) and Time Warner (NYSE: TWX), is turning his attention now to social media: he and his investment group, Kingdom Holding Company, today became the latest investors in Twitter, putting up $300 million for a strategic stake in the micro-bloging company.
The funding underscores how, while Twitter is slowly turning its attention to generating revenue on its social-media platform through advertising and marketing services, it is also still very much picking up huge injections of cash for faster growth.
It also raises the question of whether Twitter may put off thoughts of an IPO for the time being: this latest investment values the company at $10 billion, according to Jack Neele, a fund manager at Robeco Groep NV (via Bloomberg).
Not a fly-by-night prince: Kingdom Holdings, in a press release, noted that the deal was the result of several months of negotiations and due diligence on the part of the company.
It could signal a change in strategy for the company, which might be eyeing up other social media brands for further investments. Up to now, it has focused on some key stakes in regional operations, as well as some of the biggest, most established international media and tech properties:
– The company has invested $600 million in shares of News Corporation. Those shares include voting rights and the prince was the subject of some media attention earlier this year when we spoke out in support of the Murdochs during the height of the phone-hacking scandal. That investment has been used as a route to growing out News Corp.’s footprint in the Arabic world.
– Kingdom Holdings and the Prince also have a stake of Time Warner: that came by way of its initial investment of $145 million in Netscape, which subsequently got bought by AOL (NYSE: AOL). The company made further, unspecified investments in Time Warner in subsequent years, and according to its site, has a similar strategy to the one it has taken with News Corp., to partner with Time Warner on regional investments in the Middle East.
– It also, very presciently, acquired five percent of Apple back in 1997, a steal for $115 million. It’s unclear if that stake has increased or decreased but it seems more of a straight rather than strategic investment.
– Other stakes that it has held include those in Motorola (NYSE: MMI), eBay (NSDQ: EBAY) and HP (NYSE: HPQ).
– Regionally, it has a 29.9 percent stake in the publishers Saudi Research and Marketing Group (SRMG), and Rotana Group, a broadcasting JV with News Corp. The Prince also has plans to launch his own Arab news channel, Alarab.
Given Kingdom Holdings’ emphasis on building out regional operations based on strategic stakes, this could kick off an interesting chapter in the international growth of Twitter.
Twitter had already marked itself out during the “Arab spring” revolts as a key route for communicating not only among people on the ground, but also for communicating developments to the outside world.
Twitter’s platform, in its simplest form of exchanging short messages with a group of followers, is highly scalable, working not only on the web and smartphones but on the most basic of mobile handsets. That gives it a lot of potential in developing markets, as well as those that are more advanced.