- Saudi Arabian Prince Alwaleed Bin Talal announced Tuesday he’s taken a 2.3% stake in Snap – a deal worth about $US250 million.
- The prince built up his stake gradually, completing it in May when Snap’s stock was near its low ebb.
- The announcement came on the same day that Snap reported its second-quarter results.
Snap, the parent company of Snapchat, now has some royal backing.
Prince Alwaleed Bin Talal, a businessman and a member of Saudi Arabia’s royal family, announced Tuesday that he’s acquired 2.3% of the class A shares of the messaging app maker. The prince invested about $US250 million, building up his stake over time and completing his investment on May 25.
“Snapchat is one of the most innovative social media platforms in the world and we believe it has only just begun to scratch the surface of its true potential and we are blessed to be part of it,” he said in a statement.
The stake is only the latest technology investment for Prince Alwaleed, who previously bought stakes in Twitter and Lyft.
The prince met Evan Spiegel and Imran Khan, Snap’s CEO and chief strategy officer, respectively, in 2015, according to the statement.
The announcement came as Snap announced its second-quarter results. Despite posting another big loss and reporting that its number of daily active users declined for the first time as a public company, Snap saw its stock jump in after-hours trading, because its results bested Wall Street’s expectations.
Prince Alwaleed spent about $US11 a share on Snap stock. That’s near the low end of the company’s range over the last year. It bottomed out at $US10.50 a share in May.
The investment is one of the first announced by the prince since he was released from Saudi custody in January. Prince Alwaleed was one of the most prominent among a group of dozens of royal family members and top officials arrested by kingdom authorities last fall in a crackdown on alleged corruption. He was released after reaching a financial settlement with the kingdom’s attorney general.
Despite his relatively large stake, Prince Alwaleed won’t get any say in how Snap is run. That’s because the company’s class A shares get no votes in corporate matters. Instead, nearly all of the votes are held by Spiegel and his cofounder, Robert Murphy, through their control of its class C shares.
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