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Management Giants

Carlos Slim Helú

Carlos Slim, a Mexican civil engineer who is now half a billion dollars richer than previous list-topper Bill Gates, is worth $53.5 billion (39.2 billion euros), according to the 2010 Forbes magazine list of billionaires. For the first time ever, the name at the top of the Forbes Magazine list of the world’s richest people belongs to someone not from Europe, or the US, or an oil-rich Arab state, but to someone from the developing world. He built a telecom and mobile communications empire after buying Mexican telephone monopoly Telmex in 1990, and has gone on to own department stores, construction companies, and financial services firm Inbursa Financial Group, among other investments. Wealth-watchers point to the list as evidence that there is money to be made in the developing world. Carlos Slim controls more than 200 companies. These range from telecoms, where he first made his fortune, to infrastructure, banking and retail. In order to maintain his influence over his expanding empire, his sons and sons-in-law have been put in charge of many businesses. One of the most significant in Mr. Slim’s empire is America Movil, Latin America’s largest mobile phone company, which operates in 11 countries and serves more than 150 million customers. His telecoms interests also extend to Telmex - the company he fought to take control of in 1990 when it was nationalized. It now operates around 90% of Mexico’s telephone lines. Mr. Slim, whose heavy-set figure belies his name, also owns the Inbursa financial group and the Grupo Carso industrial conglomerate, interests of who range from retail stores to restaurants. Meanwhile, the infrastructure firm he owns, Ideal, is working on a project to develop a shopping centre, schools and a hospital in Mexico City. If you have yet to hear of Carlos Slim, that may be about to change. In recent years the tycoon has sought to expand his businesses abroad, including investments in 2008 in the New York Times newspaper and in the struggling bank Citigroup. In the UK he has been linked with investments in company behind the Independent and Independent on Sunday newspapers. Analysts suggest he is trying to replicate his Latin American success on a global scale. That remains to be seen, but his rise to the number one spot on the world rich list shows that a global economic downturn is unlikely to slow his progress.

Carlos Slim Helú

In 1902, Julián Slim Haddad, father of Carlos Slim Helú, arrived in Mexico from Lebanon, all alone and 14 years of age, speaking no Spanish. He was escaping from the yoke of the Ottoman Empire, which at the time conscripted young men into its army; mothers therefore sent their sons to exile before turning fifteen.

And thus Don Julián arrived in Mexico; he was a young man, energetic and full of enthusiasm and ideas, who after disembarking in Veracruz, moved to Tampico, Tamaulipas, where four of his older brothers had already settled since 1898 (José, Elías, Carlos and Pedro Slim) with the conviction that they would succeed together with the country that had received them.

Carlos Slim’s mother, Doña Linda Helú, was born in Parral, Chihuahua. She was the daughter of José Helú and Wadiha Atta, Lebanese immigrants who arrived in Mexico at the end of the 19th century, and after traveling through several cities in the Mexican Republic, decided to settle in the capital city. José Helú brought the first Arabic printing press to Mexico and founded one of the first magazines for the Lebanese community in this country.

The Slim brothers later moved to Mexico City and in 1911, Julián Slim and his brother José, who was thirteen years older than him, founded the company La Estrella de Oriente (“the Star of the East”), so named in honor of their country of origin. The partnership was formed with 25,800 pesos, each of them contributing 50 percent. In May 1914, in the midst of the Mexican Revolution, Don Julián, then 26 years old, bought his brother’s fifty percent stake for 30,000 pesos.

La Estrella de Oriente was an important dry goods store located on Calle de Capuchinas (today Venustiano Carranza); that, over time and with Don Julián’s extraordinary work ethic and business talent, had merchandise worth more than US$100,000 by January 21, 1921, only ten years after the business was founded.

By that time, Don Julián had also acquired eleven more properties in the area, which was one of the most commercial, active and significant in downtown Mexico City, and therefore in the country. The current value of the store would be more than US$7 million today, and the real estate would be worth around US$28 million.

By 1922, Don Julián’s net worth was already $1,012,258 pesos between real estate, businesses and various stocks.

In August 1926, Julián Slim and Linda Helú married in Mexico City. Their first daughter, Nour, was born four years later, and Alma two years after that, followed by Julián, José, Carlos and Linda.

With his intelligence and tenacity for work, Don Julián Slim Haddad would become a prominent businessman and the father of an exemplary family who was able to instill in his children both moral values and the dedication to and familiarity with work.

Carlos Slim Helú

Carlos Slim Helú was born on January 28, 1940 in Mexico City, where he learned from early on the value of family as a priority in life.

He also received his first business lessons in early childhood, as Don Julián gave each of his children a savings book with their usual weekly allowance in order for them to learn to manage their income and expenses. They reviewed this book with him, analyzing their expenses, purchases and activities, and by following this rule Don Julián’s children managed their finances and developed their own wealth. From that time investment and savings were part of young Carlos’s life, becoming his first lesson in business, which he soon put into practice by opening his first checking account and buying shares of Banco Nacional de México when he was only 12 years old.

With his parents and five siblings, Carlos Slim Helú grew up in a close, loving family that taught by good example, but in 1953 Don Julián died suddenly, deeply affecting the Slim Helú family; it was a sad and unexpected emotional blow that left a noticeable mark in the home. Carlos was only 13 years old.

Biographical Overview

Carlos Slim Helú studied Civil Engineering at the National Autonomous University of Mexico (known by its Spanish acronym UNAM) School of Engineering, where he also taught Algebra and Linear Programming while studying for his degree, meaning that he was both a student and professor.

In 1965, when he was only 25 years old, he began to build the foundations of Grupo Carso. Inmobiliaria Carso was incorporated in January 1966, three months before marrying Soumaya Domit Gemayel, hence the name Carso, which is a combination of the first three letters of Carlos and the first two letters of Soumaya.

Since the 1980s he has been a noted businessman in various industrial, real estate and commercial fields. In 1982, which was a critical time in the history of Mexico with the debt crisis, nationalization of the banking system and the country’s finances nearly paralyzed, Carlos Slim and his Grupo Carso decided to invest heavily and actively.

They made diverse investments and acquisitions during this period, one of which was Cigatam, which turned out to be the first and most important because of its cash flow, providing the Group with sufficient liquidity to capitalize on available opportunities and thereby increase its acquisitions of big companies, including: Hulera el Centenario, Bimex, Hoteles Calinda (today, OSTAR Grupo Hotelero) and Reynolds Aluminio.

Some time later the purchase of Seguros de México was closed, and Grupo Financiero Inbursa was formed by integrating Casa de Bolsa Inversora Bursátil, Seguros de México and Fianzas La Guardiana. By 1985, Grupo Carso acquired control of Artes Gráficas Unidas, Fábricas de Papel Loreto y Peña Pobre, and also a majority stake in Sanborns and its affiliate Dennys. In 1986 Minera FRISCO and Empresas Nacobre were acquired, as well as their affiliates, and control of the Euzkadi tire company, the market leader at the time, was also acquired, as was a majority stake in General Tire some years later.

In 1990, the group acquired Telmex in partnership with SBC and France Telecom, and began a new era of entrepreneurial development in a globally strategic sector. Over the course of 16 years, Telmex has developed a world-class technological platform that has optimized its processes and strengthened the corporate culture.

Over this period of time Telmex has invested the equivalent of US$27.692 billion in Mexico’s telecommunications infrastructure and, combined with operations in Latin America, more than US$30 billion.

América Móvil

América Móvil is a good example of value creation for investors. Since 1996, it was a pioneer and global innovator of cellular prepayment systems. In 1990, Radiomóvil Dipsa (today TELCEL) had 35 thousand customers, to September 2010, had 266.8 million of clients in Latin America, 216.7 millions of cellular subscribers, and 28.1 million fixed lines, 12.5 millions in broadband, and 9.4 millions of pay TV clients.
Mr. Slim continues to be active in business although his main effort and work is focused on education, health and employment in Mexico and Latin America, through the foundations he chairs and companies in infrastructure arena; his three sons, Carlos, Marco Antonio and Patrick Slim Domit, have taken over the reins of his businesses. Mr. Slim has lectured at public and private institutions as well as at international organizations such as the Economic Commission for Latin America (ECLA).

He was a member of the Board of Directors of Altria (previously Philip Morris Companies), and also a Board Member for SBC Communications, Inc., from which he retired in 2004 to devote more of his time to the IDEAL project, Impulsora para el Desarrollo y el Empleo en América Latina, with a particular emphasis on infrastructure, health and education.
He has also served as Vice Chairman of the Mexican Stock Exchange and Chairman of the Mexican Association of Brokerage Firms. He was the first Chairman of the Latin American Committee of the Board of Directors of the New York Stock Exchange. Carlos Slim Helú and his wife Soumaya Domit de Slim (deceased) had six children: Carlos, Marco Antonio, Patrick, Soumaya, Vanessa and Johanna.

At the time Eng. Slim was elected member of the executive board, the President and Executive Director of RAND Corporation, James A. Thomson expressed: “It is an honor to include in the executive board of RAND organization this distinguished business and philanthropist leader” and added: “Undoubtedly, Carlos Slim Helu will help the corporation to improve its 60 years of success by providing objective analysis and effective solutions related to the new challenges that the private and public sectors are facing around the world”.