Dubai’s American Exec Bounced From Sinking Ship

A quick addendum to my earlier post: David Jackson, the bon vivant-in-chief of Dubai’s private equity arm Istithmar World, has been fired resigned.  The news comes just one day after regional investment bank EFG-Hermes estimated the emirate’s debt obligations could be as high as $170 billion- about $90 billion more than was previously thought.

The removal of Jackson, who was replaced by Istithmar Chief Investment Office Andy Watson, is a definite referendum on the American’s investment style. A bold, brand-conscious style that preferred big names, marquee buildings and flash, flash, flash. Istithmar’s acquisitions during Jackson’s helm reads like the wish list of Robin Leach: Barneys, Manhattan’s W Hotel, a stake in Las Vegas’ $11 billion CityCenter development…the kind of exorbitant prestige assets we at Forbes used to call “billionaire money pits.” So, two crises later, Istithmar is implementing a change of course:

“Today, Istithmar World is focused on the steady-state management of existing assets to maximize value rather than on private equity investment,” Dubai World’s Chief Restructuring Officer Aidan Birkett said in the statement.

Via Dubai World Removes Istithmar CEO Jackson Amid Crisis (Update2) – Bloomberg.com.

This is a major change of course. Istithmar was created specifically to serve as the government’s private equity firm, so this announcement is tantamount to cease and desist. Instead of seeking out (good value, lower-risk) companies to buy and rehab, they are shelving the shopping and putting their current investments in intensive care.

As for David Jackson, the party line is that he is leaving “to pursue other opportunities.” He will likely return to the US and- if I were to guess- do something in fashion. As Dubai’s answer to Andre Leon Talley- and as that Barneys bid might suggest- Jackson’s passions lie beyond shuffling papers in the desert. Having met him and seen his raconteur skills in action, I personally hope he writes a book. He once bragged to me that “the only thing I know how to do is make money.”

Well then, a tell-all is in order.