The not too slim Slim

Carlos Slim’s father, Julién Slim Haddad, mmigrated to Mexico from Lebanon at age 14. With one of his brothers, he opened a dry-goods store in Mexico City .When foreign investors fled the country following the revolution of 1910, Julián Slim resolved to remain in Mexico. By the 1920s, he had acquired a number of businesses and substantial real estate in the capital city. Julián married Doña Linda Helú, a daughter of Lebanese immigrants. The couple raised six children, of whom Carlos Slim Helú was the fifth. The senior Slim encouraged all of his children to learn and understand finance. He gave each child a ledger to record expenditures. Young Carlos showed a special aptitude for numbers and by age 12 was buying shares in the Bank of Mexico. When Carlos Slim was 13, his father died, and the next years were difficult for Carlos. He studied civil engineering at the Autonomous National University of Mexico (UNAM), and while still studying, began to teach mathematics and linear programming. After a few years of teaching, Carlos Slim incorporated his first business venture, a stock brokerage, Inversora Bursátil. The same year, he married Soumaya Domit; in future ventures, he combined the first letters of their names, as in the name of his holding company, Grupo Carso. Remembering the lessons of thrift he had learned from his father, he and his growing family lived modestly, while earnings from his businesses were re-invested in expansion and more acquisitions.

Over the next two decades, Carlos Slim astutely acquired companies he believed were undervalued and skillfully overhauled their management. He diversified methodically, investing in real estate, then a construction equipment company, and then mining interests. The portfolio of Slims companies grew to include a printer, a tobacco company and retail stores.
In 1982, Mexico plunged into an economic crisis. The government defaulted on its foreign debts, and many
Mexican investors rushed to expatriate their capital. Carlos Slim’s confidence in his country held firm, and he acquired the Mexican affiliates of Reynolds Aluminum, General Tire and the Sanborn’s chain of stores and cafeterias. As the economy recovered, Slims fortune grew, and his acquisitions accelerated. He acquired the Mexican interests of a number of U.S.-based brands: Firestone tires, Hershey’s chocolate, and Dennys coffee shops. He bought and merged a number of insurance companies into the giant firm Seguros Inbursa. The greatest opportunity of all presented itself when the Mexican government began to divest itself of a number of state-owned monopolies. After taking the holding company public in 1990, Slims Grupo Carso, with French and American partners, purchased the state telephone company, Teléfonos de México (Telmex). Slim took a special interest in a small component of Telmex’s operations, the company’s fledgling cellular service. Slim had a unique idea for building the customer base for cell phone service in Mexico’s struggling economy. He sold the handsets with a month’s service prepaid, and rather than sending the customers a monthly bill, Slim enabled his customers to buy prepaid phone cards, using their minutes as needed. Telmex executives resisted the plan at first, convinced that aggressive promotion of prepaid cell phones would undermine the market for traditional landline service. As it happened, the prepaid program filled an enormous need, and the customer base grew by 66 percent every year for the next 15 years. In the wake of the bust of 2000, foreign-owned cellular ventures throughout Latin America floundered. Slim scooped them up, combining cellular services in a market he understood better than anyone else. Soon his company, América Móvil, had become the largest wireless services provider in Latin America. As the demand for wireless communication exploded, Slim’s enterprise grew to meet it. By 2007, his group of companies was valued at an estimated $150 billion. When Fortune magazine and other sources calculated
the wealth of the world’s leading businessmen, they concluded that Carlos Slim, with an estimated personal fortune of $59 billion, was the richest man on Earth. Proceeds from Carlos Slim’s ventures have endowed a number of charitable foundations. Since 1986, the Carso Foundation has concentrated on developing Mexico’s human capital through education and training programs.
In 2007, an additional endowment of $4 billion has expanded Carso Foundation’s efforts to build infrastructure, promote education and reduce poverty, not only in Mexico, but throughout Latin America. The Museo Soumaya, established in 1994, was named in honor of Slims late wife, who ran the institution for many years. The museum preserves a world-class collection of Mexican and European art, while funding art research and conservation activities and sponsoring traveling exhibitions. The Telmex Foundation is one of the largest philanthropic institutions in Latin America. In addition to activities in health, nutrition, conservation and disaster relief, it has provided university scholarships for hundreds of thousands of talented students who would otherwise be unable to pursue higher education. Slim himself was the principal donor to the long-term project to restore and revitalize Mexico City’s downtown, the Centro Histórico.
In 2008, Slim surprised the business world with his purchase of a 6.4 percent stake in the troubled New York Times Company. At the time his investment was made public, Slims holding in the company was valued at $27 million. The following year, as a global recession and declining advertising revenues took a particularly heavy toll on print-based “old media” companies, Slim made the Times a loan of $250 million. This infusion of cash, along with other strategic adjustments by Times management, steadied the company’s finances, and the Times repaid the loan, plus 14 percent interest, ahead of schedule. Slim and his family have purchased additional shares, raising their stake in the company to just over seven percent. They hold warrants to increase their holdings to 16 percent of the company’s total stock. Although Grupo Carso spokesmen denied any intention of buying out the Ochs-Sulzberger family, who have controlled the paper for generations, even the suggestion of such a plan caused a sharp rise in the price of New York Times stock, a dramatic demonstration of Carlos Slim’s influence in the world of finance.
In 2010, Forbes magazine’s survey of the world’s great fortunes confirmed earlier estimates that Carlos Slim was the world’s richest man. The survey ranked him as the world’s richest man again in 2011 and 2012. In the midst of this staggering success, the Slim family remains an unusually close-knit one. As Carlos Slim devotes more of his time to his philanthropic enterprises, his three sons have taken the reins of the major components of Grupo Carso. And the Slim family still dines together every Monday night.


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