UBS, a key casualty of the US subprime turmoil, faces a shareholders’ revolt over plans for a massive infusion of funds from Singapore and the Middle East to improve its capital ratios, announced last week after a massive writedown on UBS’s portfolio of mortgage debt. The FT has learned that the mystery Middle Eastern investor ploughing SFr2bn ($1.73bn) into UBS’s recapitalisation is from Saudi Arabia. Details of the Saudi royal family’s involvement were unclear but one banker said Prince Sultan, the crown prince and defence minister, was instrumental in the deal. The investment is understood to be the result of a long relationship between the private banking arm of UBS for the Middle East, headed by Michel Adjadj, and the Saudi royal family. The investor’s insistence on anonymity was among concerns raised by UBS shareholders on Thursday. One influential Swiss institutional investor urged shareholders to reject the proposal to raise SFr13bn from sovereign wealth funds. A second demanded a special audit of the bank’s losses. The danger of a revolt at the UBS special shareholders’ meeting in February to approve the measures prompted the Swiss National Bank to take the unusual step of recommending the recapitalisation

This entry was posted by Gwen Robinson on Friday, December 21st, 2007 at 5:48 and is filed under Capital markets, M&A, People. Tagged with ubs. Edit this entry.