US delays release of Khashoggi report

The United States has delayed the release of a highly-anticipated intelligence report on the murder of Saudi journalist Jamal Khashoggi. The unclassified report, prepared by the Office of the Director of National Intelligence (ODNI), includes a summary of findings by the American intelligence community on the killing. It was withheld by the previous administration.

Initial news reports suggested the summary would come out on Thursday after President Joe Biden speaks by telephone with King Salman for the first time since taking office last month. A readout of the call released by the White House made no mention of the Khashoggi report:

President Joseph R. Biden, Jr. spoke today with King Salman bin Abdulaziz al-Saud of Saudi Arabia to address the longstanding partnership between the United States and Saudi Arabia. Together they discussed regional security, including the renewed diplomatic efforts led by the United Nations and the United States to end the war in Yemen, and the U.S. commitment to help Saudi Arabia defend its territory as it faces attacks from Iranian-aligned groups. The President noted positively the recent release of several Saudi-American activists and Ms. Loujain al-Hathloul from custody, and affirmed the importance the United States places on universal human rights and the rule of law. The President told King Salman he would work to make the bilateral relationship as strong and transparent as possible. The two leaders affirmed the historic nature of the relationship and agreed to work together on mutual issues of concern and interest.

For comparison, here is the Saudi readout of the same call below. Notably, there is no mention of human rights issues or the release of detained activists:

The Custodian of the Two Holy Mosques King Salman bin Abdulaziz Al Saud made a telephone call to President Joseph Biden of the United States of America.

The Custodian of the Two Holy Mosques congratulated the President on his assumption of his post as President of the United States of America.

During the telephone conversation, the Custodian of the Two Holy Mosques and the US President stressed on the depth of the relationship between the two countries, and the importance of strengthening the partnership between them to serve their interests and achieve security and stability in the region and the world.

The most important issues in the region and developments of common interest were also reviewed, as well as Iranian behavior in the region, and its destabilizing activities and its support for terrorist groups were discussed.

In this regard, the Custodian of the Two Holy Mosques thanked the US President for the US's commitment to defend the Kingdom of Saudi Arabia against such threats and to assure that Iran will not be allowed to possess nuclear weapons.

The US President commended the Kingdom's support for the United Nations efforts to reach a truce and a ceasefire in Yemen.

The Custodian of the Two Holy Mosques affirmed the Kingdom's keenness to reach a comprehensive political solution in Yemen and its endeavor to achieve security and development for the Yemeni people.

Four US officials told Reuters that the report, for which the CIA was the main contributor, assessed that Crown Prince Mohammed bin Salman has approved the killing. The prince has denied ordering the operation but said he takes “full responsibility as a leader” in the kingdom. “The report’s findings, and Biden’s resulting next steps, at a minimum will set the administration’s tone for dealing with the ambitious 35-year-old prince,” wrote Ellen Knickmeyer of the Associated Press.

The report was not released by the time of sending this newsletter, but remains expected as early as Friday.

Secretary of State Anthony Blinken spoke with his Saudi counterpart Prince Faisal bin Farhan on Thursday ahead of the call between Biden and the king. The two top diplomats “discussed the importance of Saudi progress on human rights, including through legal and judicial reforms, and our joint efforts to bolster Saudi defenses,” spokesperson Ned Price said in a readout of the call.

Prince Mohammed underwent successful surgery to remove his appendix, the royal court said in a statement released Wednesday. The operation was conducted at King Faisal Specialist Hospital in Riyadh. The statement said it was a laparoscopic appendectomy, a less invasive method done without a large incision. State media published a short smartphone video of the heir to the throne wearing a face mask and walking out of the hospital before getting into a waiting black Mercedes.

The prince “was discharged from the hospital after God blessed him with health and wellness,” the royal court said. There was no previous announcement that he was admitted. His most recent public appearance before this was when he attended and crowned the winner at the $20m Saudi Cup horserace on Saturday night.


Lucid goes public via Spac

From the Financial Times:

Electric vehicle start-up Lucid Motors has agreed to go public in a $24bn deal with a blank cheque company controlled by veteran dealmaker Michael Klein, in the largest such reverse merger to date.

The California company, which is majority owned by Saudi Arabia’s sovereign wealth fund, will combine with Churchill Capital IV, the fourth of Klein’s special purpose acquisition companies, which raised $1.8bn in July.

The deal had been widely rumoured and investor excitement had sent shares in the Spac up almost 500 per cent so far this year — but they fell by more than a quarter in after-hours trading as financial details were revealed on Monday.

As part of the transaction, Lucid will receive the cash raised by Churchill Capital IV as well as $2.5bn of new money from investors again led by Saudi Arabia’s Public Investment Fund, along with BlackRock, Fidelity and others. The so-called private investment in public equity transaction — a fundraising that often accompanies Spac deals — ranks among the largest ever.

The deal is seen as a coup for the PIF, which invested $1 bn in Lucid in 2018 and is expected to provide an additional $600m in funding for the startup before it goes public via the controversial Spac route. The fund is sitting on paper gains of over 30-fold from that investment and will hold a stake of 62% in the company once the acquisition is complete.

The PIF, chaired by the crown prince and led by his aide Yasir al-Rumayyan, had previously owned a 5% stake in Tesla but missed out on an epic rally in the leading EV maker’s shares after selling its holdings in late 2019. Lucid has been reportedly in talks with the fund over building a factory near Jeddah, but the company’s chief executive Peter Rawlinson said Tuesday that there were no imminent plans to build a manufacturing facility in the kingdom.

Lucid has made its name as a maker of battery technology for racing cars. The company is the designer and producer of battery packs for all 24 vehicles in Formula E, the electric racing championship founded in 2014. Saudi Arabia has been hosting an annual race of the championship since 2018 as part of the kingdom’s plans to become a hub for international sports events. The next Diriyah E-Prix is set to take place this weekend in the royal family’s ancestral hometown in northwestern Riyadh.

The investment in the sport’s technology partner might be one of the reasons why the crown prince appears to be interested in the races. He attended the race in 2019 and took the time to mingle with guests who posed for selfies with him.


New dates for Red Sea film fest

Saudi Arabia’s Red Sea International Film Festival has announced dates for its inaugural event later this year after the coronavirus forced organisers to postpone its original plans. The event is one of the major elements of the kingdom’s strategy to grow the arts and culture sectors after the government allowed cinema theatres to reopen in 2018. The festival is now is set to run from November 11th to 20th, 2021, in Jeddah’s Old Town aka al-Balad, a Unesco World Heritage site.

While not Saudi Arabia’s first or only film festival, the RSFF is the kingdom’s first full-fledged international film event on this scale, and it is backed by the new Ministry of Culture which is led by Prince Badr bin Abdullah bin Farhan, a close aide of the crown prince. Saudi director Mahmoud Sabbagh stepped down as festival chief last July after original plans to organise the event in March 2020 were scrapped. The festival has yet to name a replacement for Sabbagh who reportedly left to focus on his own projects.

Despite not holding the main event, the RSFF has carried out other activities related to the festival, including organising workshops and giving grants for young filmmakers. RSFF supported the production of the Saudi film “The Book of Sun”, which was originally slated to open the festival. The film premiered last July in Saudi theatres as the kingdom eased its coronavirus restrictions over the summer.