Playboy Prince Jefri is hit by the œ10bn collapse of business empire
By Neil Bennett, City Editor
THE Sultan of Brunei has ordered a worldwide investigation into the
financial affairs of his brother Prince Jefri Bolkiah, whose flagship
investment company has collapsed with losses estimated at up to œ10
billion.
The Sultan, widely held to be the richest man in the world, has drafted
in top financial experts, including accountants from Price Waterhouse,
to discover the full extent of his brother's losses. This follows the
failure of Amedeo, Prince Jefri's construction and investment group.
Amedeo has debts of hundreds of millions of pounds and dozens of British
suppliers have not been paid for more than a year. The head of one firm,
which is owed œ500,000, said his company faced a struggle for survival
without the money. "When you are working for the brother of the richest
man in the world, you expect to have your bills paid,' he said.
The 51-year-old Sultan is said to be furious with his brother. Prince
Jefri's fleet of jets is said to have been impounded at Brunei and many
are now up for sale. The Sultan is also determined to track down the
senior managers of Amedeo, who have all left the country. One of the
sultan's close associates said: "The king is very disappointed in his
brother, but he is still his brother. Emotion is still very strong
between them."
Amedeo is the largest private company in Brunei. Prince Jefri, 44, is
one of the world's best known playboys. At one point his wealth was
estimated at œ20 billion, but as much as half of that has been lost in
the collapse. The exact source of his fortune is unknown, but he is
believed to receive regular payments from Brunei's vast oil revenues.
Some of these he spent setting up Amedeo, which the government regularly
chose as its contractor on prime infrastructure developments. These were
also funded by the country's oil money.
Prince Jefri used cash from Amedeo to finance a spending spree, buying
some of the world's best known hotels, including the Plaza Athenee in
Paris and the Bel-Air in Los Angeles, as well as Asprey, the Royal
jewellers. Many of these are now expected to be sold.
Under Prince Jefri's leadership Asprey sponsored the Ferrari Formula One
team, and its driver Michael Schumacher, for an estimated œ20 million.
Two weeks ago Asprey announced plans to merge its main store with
Garrard, which it also owns, as part of a cost-cutting drive prompted by
his straitened circumstances.
Prince Jefri, who was once Brunei's finance minister, owns 600 cars and
a vast yacht called Tits, with two tenders called Nipple 1 and Nipple 2.
He owns five houses in London and likes football so much that he once
flew Chelsea to Brunei for a game against the national side. He also
hired Rod Stewart to play at one his children's parties.
The Prince has four wives and three children, and regularly plays polo
with the Prince of Wales. He runs his own team, Jerudong Park. Earlier
this year Prince Jefri was sued for œ250 million by Bob and Rafi
Manoukian, two former business associates. The Prince counter-sued for
more than œ100 million. The brothers alleged in court that the Prince
regularly entertained prostitutes in his Park Lane flat. The case was
later settled out of court. In the case, Rafi Manoukian claimed that he
had procured more than œ500 million worth of gifts and jewellery for the
Prince over 14 years, including erotic pens and watches and a
jewel-encrusted bedside rug valued at œ5 million.
Last week Haji Ismail, Brunei's minister of development, announced that
the government was taking over some of Amedeo's key projects in the
country, including a six-star hotel at Jerudong Park and several power
stations that it was building with Siemens, the German industrial group.
But he said that the government would not pay off Amedeo's debts. He
said: "Amedeo should deal with its own problems."
He also called on Prince Jefri and his business associates to return to
Brunei to deal with Amedeo's troubles and said: "I hope Amedeo is not
saying, 'Forget all things and let them rot'. They can come forward and
discuss what can be done. I wish I knew what is going on. I do not know
what went wrong. There has been no transparency as to what has been
taking place. Amedeo cannot just run away if it intends to honour its
commitments. It cannot expect someone to drop from the sky to help."
The Brunei authorities are particularly keen to talk to Danny Wong,
Amedeo's managing director, who is said to be in Britain. Prince Jefri's
whereabouts are unknown, although one executive involved in the affair
said he is holidaying in continental Europe.
The collapse of Amedeo appears to have been triggered by a sharp
economic downturn in Brunei, one of the world's richest nations. This
has been caused by the economic slump in the rest of Asia, which began a
year ago, and the plunging oil price, which has fallen almost 40 per
cent in the past year to less than $14 a barrel. Almost all Brunei's
wealth is generated by its oil fields.
The Brunei government has been forced to make sharp spending cuts,
reducing construction work available for Amedeo. This has plunged the
group into a massive cash flow crisis. The extent of Amedeo's losses are
still not clear, but locals say it could be as high as $16 billion.
Others say this is an exaggeration, but the shortfall in assets could
well run into billions. The group took on many of Brunei's largest
infrastructure projects and was richly paid for them by the government
and the Sultan. But Amedeo now has no cash to pay its suppliers,
although many of its largest projects are still unfinished. These
include the Datastream Technology Tower, the tallest building in Brunei.
The Sultan is due to receive a full report on the extent of Amedeo's
financial woes within the next few days. Then he will decide what needs
to be done. Locals expect that Amedeo will be wound up and its assets
sold off to meet claims from creditors. The government is expected to
resist pressure from creditors to underwrite Amedeo's vast liabilities.
One associate said: "The king is not going to meet Jefri's debts."
5 March 1998: Asprey sinks œ1m in copy of Titanic necklace |
