Blown billions, Part I

Blown billions, Part I

Banks in the Gulf and beyond are reeling from Saudi Arabia’s Saad and al-Gosaibi scandal. We look at the web of relationships behind a dispute that will change the way business is done in the region, reports Trend magazine. Part I

October 14, 2009 4:44 by Ehtesham Shahid

The news spread quickly, and al-Sanea issued a statement attributing the trouble to the global credit crisis causing

“a sudden shrinking of available facilities given by regional and global banks.” Al-Sanea claimed to be taking drastic measures in response. “We are planning the restructuring of the companies in cooperation with our partners and international consultants. We are confident that we will solve this problem,” the statement said.

The freezing of al-Sanea’s assets, it turns out, had followed a number of related developments in Bahrain, where The

International Bank Corporation (TIBC), a company licensed as a bank in Bahrain and majority owned by AHAB, had defaulted on its debts earlier in May. The relationship between al-Sanea and TIBC is murky and subject to dispute, with al-Sanea owning a 25 percent stake in the company. According to one source close to the companies, Maan al-Sanea had in fact been running TIBC indirectly via another Bahraini bank called Awal, a charge al-Sanea denies.

The web is already dense

Maan al-Sanea’s wife, Sana al-Gosaibi, became one of 20 owners of AHAB following the death of her uncle, Suleiman al-Gosaibi, on Feb. 22 this year. Suleiman al-Gosaibi, the last surviving of the three brothers in Ahmad Hamad al-Gosaibi & Brothers, only ran AHAB for a few years, because until his death in 2003, the master and commander of the al-Gosaibi clan had long been Abdulaziz, the middle brother.

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Tags: Ahmad Hamad al-Gosaibi & Brothers, Maan al-Sanea, Saad Group

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1 Comment

FG on October 14, 2009 7:45 pm

Interesting synopsis of a developing story. Note that Al Sanea (his mother is related to Kuwait’s ruling Al-Sabah clan) did not work for AHAB until he married Sana, at which time he was effectively given management control of the AHAB owned Money Exchange – akin to a dowry of sorts. Sana and her husband were considered heirs to the business model that her father had built . It was Ahmad, the oldest of the Al Gosaibi brothers, who built the trading operations and laid the industrial foundation, but Abdulaziz who used it as collateral to leverage the family into the billion dollar league.

Cousins Yousef and Saud (Sana’s younger brother) are managing AHAB’s operations but it is likely that they may not be the market makers their respective fathers were. That Saud may have been jealous of his brother-in-law is possible, but outright incompetence in management – well the owners are to wholly be blamed for that.