However, our source, a former acquaintance of Vettivetpillai’s, said the executive was “happy just being the bookkeeper, as long as he got to enjoy the rewards of the job”.
While the media describes Naqvi as the mastermind behind a “global criminal conspiracy,” under his leadership, the investors – as well as the employees – enjoyed market beating returns.
Some of its success stories include a UAE water treatment company, an Omani insurer, a Qatari financial services company, and a Jordanian internet company – all of which sold on to generate a total of $81 million in profit, triple the amount Abraaj invested to buy them.
Even Fadi Ghandour’s logistics crown jewel Aramex doubled its sales under Abraaj’s ownership to $232 million, while profit quadrupled to $20 million in just four years. In 2005 when Abraaj sold its shares in the company on the Dubai stock exchange, it received $86 million, over five times the $15 million it had invested. Hundreds of Aramex employees owning stock options shared a $14 million payout.
Abraaj also paid investors a $600 million dividend after buying a quarter of EFG Hermes in 2006 for $505 million and selling the shares over a year later for double the price of $1.1 billion. Other successful Abraaj investments include shares in construction company Arabtech, as well as Turkish hospital chain Acibadem, which Abraaj sold to Malaysian and Singaporean investors for a $355 million profit.
Moreover, Abraaj sold its shares in Integrated Diagnostics Holdings (IDH), which operated medical-testing clinics in Egypt, in an IPO on the London Stock Exchange in 2015, after it doubled the size of IDH’s network of clinics. Under Abraaj’s ownership, it not only survived the strains of the Arab Spring, it thrived in spite of them.
FILE PHOTO. Jebel Ali Port, Dubai. © Getty Images / Thierry Dosogne
An investment banker who prefers to remain anonymous for the purpose of this article told me, “Financial markets are war zones. They attack people when they lose money and forget the times they made money.”
“Abraaj made exits at enormous realised profits to its investors… even though Silicon Valley is built on overvaluations before realisations occur. Startups spend money before they make profit. Abraaj was on the verge of takeoff,” he said.
And while the world may know who benefited from the rise of Abraaj, the question the media and the authors of The Key Man failed to address is, who benefited from the fall of Abraaj? Certainly not Naqvi, whose extradition to the US has been adjourned by a judge due to concerns of his having “intermittent thoughts of not wanting to be alive,” according to court documents. If Naqvi is to be extradited to the US, he will be prosecuted under a US law created to prosecute criminal gangs like the mafia.
If found guilty, he faces what is effectively a life sentence; 291 years in a US federal prison.
It’s a harsher sentence than that of the UK and US’ most notorious criminals, such as disgraced English tech entrepreneur Mike Lynch, or American fraudster Bernie Madoff, who ran the largest Ponzi scheme in history, worth around $64.8 billion.
Naqvi’s bail was also bizarrely set at £15 million, the highest in the UK’s judicial history, whilst Lynch’s bail was set at £1 million. The Englishman, who inflated the price of his company to $11 billion ahead of its sale to a US conglomerate, made $800 million from the deal.
Even the infamous Madoff “only” got sentenced to 150 years in prison compared to Naqvi’s potential 291 years, while Lynch’s sentence amounts to a lenient 20 years in comparison.
So, what warrants Naqvi’s alleged crimes being punished twice as harsh as others? US defense attorney Michael Baldassare – who was hired by Naqvi’s lawyers to give his expert opinion – said Naqvi is unlikely to be granted bail in US courts, where federal judges “are a law unto themselves.”
There’s also the theory that, according to the same financial analyst who asked to remain anonymous, “US companies were looking to capture market share by buying Abraaj’s assets for cents on the dollar.”
A relevant prediction was voiced by Khalid Howladar, managing director and founder of risk and regulatory advisory firm Acreditus, in 2019. He said. “there are probably some attractive assets on the [Abraaj] balance sheet and a sale of one or more of these over 2019 is likely,” according to The National newspaper.
FILE PHOTO. A cargo ship in Red Sea near Aqaba, Jordan. © Getty Images / Philippe Marion
Some of the companies who bid for Abraaj include two of America’s most powerful and politically connected private equity firms, Thomas Barrack’s Colony Capital and Stephen Feinberg’s Cereberus Capital Management, which offered $125 million to buy Abraaj. It later canceled its offer, along with Colony Capital, and submitted new, lower bids. “By backing out at the last minute, they effectively opened the door to piecemeal sales which were also grabbed fund-by-fund by Western private equity firms,” the same financial analyst told me.
Even Obama’s former commerce secretary Penny Pritzker entered a bid to buy Abraaj through a group she said had “significant relationships at the highest levels of government and the private sector which, as you know, can be critical to unlocking opportunities for growth in emerging markets,” according to The Key Man book.
It begs the question, why would the ex-commerce secretary of the former US president be interested in a Middle East company like Abraaj? Unless Naqvi had built something so valuable that executives at the highest levels of the US government had their eyes on, even after its collapse.
All of the bids to buy Abraaj as a firm fell through, so the liquidators ended up breaking it up and selling off pieces of it, and for cents on the dollar, my sources told me. According to The Key Man book, buying Abraaj’s operations could give the companies footholds in new markets across Africa, Asia and Latin America. It claims that their interest in buying Abraaj ironically confirmed Naqvi’s argument that growth markets (as he liked to call them), represented the future.
And so, I bid goodbye to a man who may spend the rest of his days in a 6ft by 8ft prison cell. Today is a chilly day in London. However, I opt out of taking a cab back to my hotel and decide to walk instead. I have a new appreciation for freedom.
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