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Carlos Slim

 
Business Biographies: Carlos Slim
Home > Library > Business & Finance > Business Biographies
(1940–)

Former chairman, Telmex

Nationality: Mexican.

Born: 1940, in Mexico.

Education: National Autonomous University of Mexico, BS.

Family: Son of a merchant and realtor (name unknown); widowed (wife's name unknown); children: six.

Career: Grupo Carso, ?–1998, chairman; Telmex, 1990–2004, chairman.

Carlos Slim used his holding company Grupo Carso to become involved in a wide variety of economic activities, ranging from telecommunications to retail sales. With a personal fortune that reached $11 billion in 2002, Slim was the richest person in Latin America and one of the wealthiest people in the world. He established a reputation for buying failing companies at low prices and then restoring them to profitability. By the late 1990s Slim had begun to slowly hand the reins of his business empire over to his sons.

Early Business Sense

Slim was born in Mexico in 1940 to a Lebanese immigrant who had entered the country in 1902. His father enjoyed success as a merchant and then made a fortune in real estate during the Mexican Revolution of 1910–1920. When Slim was 12 years old, his father gave him the equivalent of about $20; he soon found ways to make the money multiply, keeping detailed records of his transactions. By the time Slim was 17, he was already investing in the stock market.

Slim went on to receive a degree in engineering from the National Autonomous University of Mexico and by the mid-1960s was investing in a variety of businesses that became the foundation for Grupo Carso. His conglomerate comprised 30,000 employees involved in activities and products such as mining, manufacturing, paper, and tobacco. After an economic crash in 1982 the Mexican government, defaulting on foreign debts in light of the devalued peso, began nationalizing banks and scaring business investors away. During this period Slim bought controlling interests in a wide variety of companies at low prices; he then set out to restore those companies to financial health. He managed his investments so efficiently that within a decade their value—and his—had greatly increased.

Buys Telmex

In 1990 Slim led a consortium that bought the state-owned telephone company Telmex from the Mexican government. Slim's Grupo Carso was the biggest investor in a consortium that also included France Telecom and Southwestern Bell. Slim and his own partners committed to investing up to $10 billion in the inefficient telephone company over the next five years; in exchange for this guarantee Slim was protected from a hostile takeover, in that his controlling shares would be off-limits for the coming 10 years.

Slim was widely credited with transforming the former state-owned company, in part because the $10 billion investment served to modernize the once inefficient utility. However, Slim still had to deal with the bad memories that Mexicans had of Telmex from its days as a government monopoly. He lamented to Julia Preston of the New York Times, "We have a problem between the time you make corrections and the time the public perceives them" (November 14, 1996).

Another challenge Slim faced came about in 1997, when Telmex's monopoly on long-distance telephone service expired, and a series of foreign and domestic competitors sought to gain shares of the Mexican market. Slim and Telmex launched an aggressive, nationalistic advertising campaign against the new competitors. Slim told Preston, "If our competitors are going to be aggressive, we are going to be just as aggressive" (November 14, 1996). Slim was upset by the fact that competitors were allowed by the Mexican government to use Telmex's network at low costs in areas of the country where they lacked their own networks. Nevertheless Slim remained optimistic that Telmex would be able to withstand the new competition, even creating a new holding company called Carso Global Telecom to buy Telmex stock. One analyst commented in the New York Times, "He's putting his money where his mouth is. His view is that Telmex will continue to be the dominant player in its market" (November 14, 1996).

Passing the Reins

By the late 1990s, Slim began to pave the way for his three sons to succeed him. The transition may have been initiated in part because in 1997 Slim had heart surgery and also suffered from pneumonia. In 1998 his oldest son, Carlos Slim Domit, became the chairman of Grupo Carso. Meanwhile Slim stayed on as chairman of both Telmex and Carso Global Telecom. He spent several years training his sons to eventually take over his vast business holdings, putting his oldest son in charge of a retail chain, while a younger son ran a mining company; he steadily handed increasing amounts of responsibility over to his sons. In 2004 Slim stepped down as chairman of Telmex, retaining the title of honorary lifetime chairman.

Beyond his business dealings Slim became a noted philanthropist and art collector—his collection in fact became so large that he was obligated to open a museum. He also played a prominent role in the revitalization of the historic center of Mexico City and supported anticrime efforts there. In late 2002 he led a group of Mexican businessmen who invited the former New York City mayor Rudolph Giuliani to Mexico's capital to help combat crime. Slim eventually devoted more and more time to the charitable foundations that he created.

Sources for Further Information

Graham, Robert, and Richard Johns, "Consortium Wins Control of Telmex," Financial Times, December 11, 1990.

Malkin, Elisabeth, "Reins Are Passed, Somewhat, at Mexican Empire," New York Times, May 4, 2004.

Preston, Julia, "Mexican Business Giant Begins Transition to Sons," New York Times, October 15, 1998.

——, "Mexican Retail Conglomerate Buying Rest of CompUSA," New York Times, January 25, 2000.

——, "Mexico's Telephone Revolution," New York Times, November 14, 1996.

—Ronald Young

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Wikipedia: Carlos Slim
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Home > Library > Miscellaneous > Wikipedia
Carlos Slim
Born January 28, 1940 (1940-01-28) (age 69)
Mexico City, Mexico
Nationality  Mexico
Alma mater Universidad Nacional Autonoma de Mexico - UNAM
Occupation Chairman and CEO, Telmex, Telcel and América Móvil
Net worth ▼US$35 billion (2009).[1]
Religious beliefs Maronite Catholic[2]
Spouse(s) Soumaya Domit (-1999)
Children Carlos, Marco Antonio, Patricio, Johanna, & two other daughters
This is a Spanish name; the first family name is Slim and the second is Helú.

Carlos Slim Helú (Spanish pronunciation: [ˈkarlos eˈslim eˈlu]), simply known as Carlos Slim (born January 28, 1940) is a Mexican engineer, businessman and philanthropist largely focused on the telecommunications industry. He is currently the third wealthiest person in the world with a net worth of around US$35 billion through his holdings. He was able to raise money for a telecommunications company by purchasing standby letters of credit which enabled him to obtain guaranteed loans which provided the capital.[1]

Slim has a substantial influence over the telecommunications industry in Mexico and much of Latin America. He controls Teléfonos de México (Telmex), Telcel and América Móvil companies. Though he maintains an active involvement in his companies, his three sons — Carlos, Marco Antonio and Patrick Slim Domit — head them on a day-to-day basis.

Contents

Early life

Slim was born in Mexico City, Mexico. His father, Julián Slim, a Maronite Catholic, emigrated from Lebanon at the age of 14. In 1911, Julián established a dry goods store called La Estrella del Oriente (Star of the Orient) and purchased real estate in downtown Mexico City. He and his wife, also of Lebanese extraction but born in Mexico, had six children, of whom Carlos was the youngest boy. Julián's wife is Linda Helú Atta who was born in Parral, Chihuahua to José Helú and Wadiha Atta.

Slim is the surname of Carlos' father Julián, who was called Youssef Salim before moving to Mexico, upon which he changed his first name to Julián and altered his surname to Slim. He officially became Julián Slim Haddad by adding Haddad, his mother's surname, according to the Spanish-language naming customs. Carlos Slim studied engineering at the Universidad Nacional Autónoma de México. He married Soumaya Domit, also a Lebanese-Mexican, in 1967; the couple had six children and were married for 32 years until Domit died of a kidney ailment in 1999. The youngest daughter, Johanna, is married to Arturo Elías Ayub who is a board member of some of Slim's companies. Since the death of his beloved wife, Carlos fell deeply in love with Interior Decorator Maria-Migdalia Soto famous for her work at the Biltmore and Mandarin Oriental hotels. Since her death in 2007 Carlos Slim has not been linked romantically to anyone. It was once said that Slim spent an estimated $20 million in jewelry for Soto.

World's third richest person

On March 11, 2009, Forbes ranked Slim as the world's third-richest person, behind Bill Gates and Warren Buffett and ahead of Lawrence Ellison.[1] Since last year Slim lost US$25 billion (on paper).

On March 5, 2008, Forbes ranked Slim as the world's second-richest person, behind Warren Buffett and ahead of Bill Gates.[3] During some parts of 2007, several major financial publications had ranked Slim as the richest person on Earth.

On August 8, 2007, Fortune reported that Slim had overtaken Gates as the world's richest man. Slim's estimated fortune soared to US$90 billion, based on the value of his public holdings at the end of July. Gates' net worth was estimated to be at least US$58 billion.[4][5]

On August 4, 2007, The Wall Street Journal ran a cover story profiling Slim. The article said, "While the market value of his stake in publicly traded companies could decline at any time, at the moment he is probably wealthier than Bill Gates".[4] On March 29, 2007, Slim surpassed Warren Buffett as the world's second richest person with an estimated net worth of US$53.1 billion compared to Buffett's US$52.4 billion.[6] According to The Wall Street Journal, Slim credits part of his ability to discover investment opportunities early to the writings of his friend, futurist author Alvin Toffler.[4]

Achievements and directorships

Slim has been vice-president of the Mexican Stock Exchange and president of the Mexican Association of Brokerage Houses. He was the first president of the Latin-American Committee of the New York Stock Exchange Administration Council, and was in office from 1996 through 1998.

He was on the Board of Directors of the Altria Group (previously Philip Morris) (resigned in April 2006) and Alcatel. Slim currently sits on the Board of Directors for Philip Morris International. He was on the Board of Directors of SBC Communications until July 2004 to devote more time to the World Education & Development Fund, which focused on infrastructure, health and education projects. In 1997, just before the company introduced its iMac line, Slim bought three percent of Apple Computer's stock, which has skyrocketed over the years.

He built the large Mexican financial-industrial conglomerate Grupo Carso which controls, among other companies, Sanborns (a prestigious food chain in Mexico), Mixup (music retail), Sears Mexico, Cigatam, Condumex and Grupo Hotelero Hostam and had indirect control over the now bankrupt CompUSA electronic retail chain.

On December 8, 2007, Grupo Carso announced that the remaining 103 CompUSA stores would be either liquidated or sold, bringing an end to the struggling company.[7] After 28 years he became the Honorary Lifetime Chairman of the business. He is also Chairman of Teléfonos de Mexico, América Móvil, and Grupo Financiero Inbursa.

Slim is said to have shown an interest in buying the Honda Formula One team.[8] Slim would overtake the billionaire owner of Force India, Vijay Mallya, to become the richest team owner in a sport famous for being a playground for the super wealthy.

Additionally, Slim has recently made it known in the Mexican press that he will soon announce his intentions to acquire a Major League Soccer franchise to be located in Queens, New York that will initially be set up in the second-tier United Soccer Leagues.

Telecom leadership

Slim gained notoriety when he led a group of investors that included France Télécom and Southwestern Bell Corporation in buying Telmex and Telnor from the Mexican government in 1990 in a public tender during the presidency of Carlos Salinas. Today, 90 percent of the telephone lines in Mexico are operated by Telmex.[9] The mobile company, Telcel, which Slim also controls, operates almost eighty percent of all the country's cellphones. These operations have financed Slim's expansion abroad. Over the past five years, his wireless carrier América Móvil has bought cellphone companies across Latin America, and is now the region's dominant company, with more than 100 million subscribers.

Slim was once MCI's largest shareholder, with 13 percent ownership. On April 11, 2005, The Wall Street Journal announced that he had sold his stake in MCI to Verizon Communications.

Media

On September 10, 2008 Slim announced that he had purchased a 6.4 percent common-stock stake in The New York Times Company, making him the largest shareholder not related to the company's owners, the Sulzberger family.[10]

Then, on January 19, 2009, the financially-troubled Times Company announced that it had accepted a $250 million loan from Slim.[11] While the loan will help ease the company's cash flow problems, it does not come close to eliminating the Times Company's $1.1 billion debt.[11] The company's continuing financial problems and Slim's ongoing interest in its work, as evidenced by his two interventions in the course of five months, has led to speculation that he might be contemplating an outright takeover of the Times Company.[12] A spokesman for Slim told reporters in January 2009 that the Times loan was an investment opportunity "that makes financial sense."[13]

Impulsora del Desarrollo y el Empleo

He leads Impulsora del Desarrollo y el Empleo en America Latina SAB de CV (IDEAL - roughly translated as "Promoter of Development and Employment in Latin America"), a Mexico-based company primarily engaged in infrastructure development. IDEAL is active in transportation, crude oil and gas, power, water, real estate and technology. Within these sectors, the company performs as a concessionaire of highways, hydroelectric plants projects, electronic toll collection systems and ports. It is also engaged in the exploration, production, transport, refinement and distribution of crude oil and gas mainly through offshore oil platforms for deep waters. Additionally, it is engaged in the construction and operation of water treatment plants, investments and development of the urban and rural properties, primarily in the commercial, health and education sectors. The company’s main subsidiaries are Desarollo de America Latina SA de CV and Promotora del Desarollo de America Latina SA de CV.

Criticism

The Mexican magnate's rising fortune has caused a controversy because it has been amassed in a developing country where per capita income does not surpass $14,500 a year, and nearly 17% of the population lives in poverty.[14] Critics claim that Slim is a monopolist, pointing to Telmex’s control of 90% of the Mexican landline telephone market. Slim's wealth is the equivalent of roughly 2% of Mexico's annual economic output.[15] Telmex, which is 49.1% owned by Slim and his family, charges among the highest usage fees in the world, says the Organisation for Economic Co-operation and Development.[16]

According to Professor Celso Garrido, an economist at the Universidad Nacional Autonoma de Mexico, Slim's domination of his country's conglomerates chokes off growth of smaller companies, resulting in a shortage of good jobs and driving many Mexicans to seek better lives north of the Rio Grande.[17]

Slim says he is unfazed by the criticism: "When you live for others' opinions, you are dead. I don't want to live thinking about how I'll be remembered." He also claims indifference about his ranking and says he has no interest in becoming the world's richest person. When asked to explain his sudden increase in wealth at a press conference soon after Forbes annual billionaire rankings were published, he reportedly said, "The stock market goes up ... and down," and noted that his fortune could quickly drop.[15]

Slim heads the Latin America Development Fund, which seeks to fund economic development projects throughout Latin America.

Philanthropy

In 2000, Slim organized the Fundación del Centro Histórico de la Ciudad de México A.C. (Mexico City Historic Downtown Foundation), whose objective is to revitalize and rescue Mexico City's historic downtown to enable more people to live, work and find entertainment in this area. He has been Chairman of the Executive Committee for the Restoration of the Historic Center since 2001.

The Carlos Slim Foundation sponsors the "Museo Soumaya" with the most extensive Rodin and Dali collection in Latin America and one of the largest in the world as well as a renowned religious art from colonial times.[18]

Awards

Slim has been awarded the Entrepreneurial Merit Medal of Honor from Mexico's Chamber of Commerce. He is a "gold patron" of the American Academy of Achievement,[19] and the Belgian government awarded him the Leopold II Commander Meda, CEO of the year in 2003 by Latin Trade magazine and one year later CEO of the decade by the same magazine.

See also

References

  1. ^ a b c Kroll, Luisa (March 11, 2009). "The World's Billionaires". Forbes. http://www.forbes.com/2009/03/11/worlds-richest-people-billionaires-2009-billionaires_land.html. Retrieved 2008-03-11. 
  2. ^ Carlos Slim Helu - Trade by Numbers
  3. ^ Miller, Matthew (March 5, 2008). "Gates No Longer World's Richest Man". Forbes. http://www.forbes.com/home/billionaires/2008/03/05/buffett-worlds-richest-cx_mm_0229buffetrichest.html. Retrieved 2008-03-05. 
  4. ^ a b c Luhnow, David (August 4, 2007). "The Secrets of the World's Richest Man". The Wall Street Journal. p. A1. http://online.wsj.com/article/SB118615255900587380.html?mod=home_we_banner_left. Retrieved 2007-08-04. 
  5. ^ Mehta, Stephanie (August 6, 2007). "Carlos Slim, the richest man in the world". Fortune. http://money.cnn.com/2007/08/03/news/international/carlosslim.fortune/index.htm?postversion=2007080614. Retrieved 2007-08-06. 
  6. ^ Coster, Helen (April 11, 2007). "Carlos Slim Helu Now World's Second-Richest Man". Forbes. http://www.forbes.com/business/2007/04/11/billionaires-helu-telecom-biz-cz_hc_0411helu.html. Retrieved 2007-08-11. 
  7. ^ "End of the Line for CompUSA". sfgate.com. December 9, 2007. http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2007/12/08/BU3ETQI3S.DTL. Retrieved 2007-12-09. 
  8. ^ "Carlos Slim Eyes Honda Purchase". speedtv.com. December 22, 2008. http://formula-one.speedtv.com/article/f1-carlos-slim-eyes-honda-purchase. Retrieved 2008-12-22. 
  9. ^ Thompson, Ginger (June 3, 2006). "Prodded by the Left, Mexico's Richest Man Talks Equity". New York Times. http://www.nytimes.com/2006/06/03/world/americas/03slim.html?pagewanted=2&ei=5088&en=87ff5ffac4ee12aa&ex=1306987200&partner=rssnyt&emc=rss. 
  10. ^ "www.paidcontent.org/entry/419-mexican-billionaire-helu-takes-stake-in-new-york-times-company/". http://www.paidcontent.org/entry/419-mexican-billionaire-helu-takes-stake-in-new-york-times-company/. 
  11. ^ a b Eric Dash, "Mexican Billionaire Invests in Times Company," New York Times, January 19, 2009.
  12. ^ Paul Gillin, "Will Slim Bid for Times Co.?," Newspaper Death Watch, January 21, 2009.
  13. ^ Tunku Varadarajan, "Carlos Slim and the New York Times," Forbes.com, January 26, 2009.
  14. ^ "UN HDI table". United Nations. 2008. http://hdr.undp.org/en/media/HDI_2008_EN_Tables.pdf. Retrieved 2009-05-27. 
  15. ^ a b Coster, Helen (2007-04-11). "Carlos Slim Helu Now World's Second-Richest Man". Forbes. http://www.forbes.com/2007/04/11/billionaires-helu-telecom-biz-cz_hc_0411helu.html. Retrieved 2009-05-27. 
  16. ^ Smith, Geri (2007-03-05). "Slim's Big Giveaway: As the government steps up its scrutiny, the billionaire is stepping up his philanthropy". BusinessWeek. http://www.businessweek.com/magazine/content/07_10/b4024065.htm?campaign_id=rss_magzn. Retrieved 2009-05-27. 
  17. ^ Porras, Andy (2007-07-13). "Mexico's wealthiest mogul spurs controversy". Hispanic Link. http://www.scrippsnews.com/node/25270. Retrieved 2009-05-27. 
  18. ^ http://www.soumaya.com.mx/
  19. ^ "About the Academy: Academy Patrons". Academy of Achievement website. Academy of Achievement. 2007. http://www.achievement.org/autodoc/pagegen/brochure/academy_patrons.html. Retrieved 2007-08-06. 

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