- Associated Press - Monday, December 19, 2011

DUBAI, United Aram Emirates — Saudi billionaire Prince Alwaleed bin Talal and his investment company said Monday they are investing a combined $300 million into Twitter, increasing the microblogging site’s cash cushion as its user-base expands.

Prince Alwaleed’s joint investment with his Kingdom Holding Co. follows months of negotiations and will give them a “strategic stake” in Twitter, according to the Riyadh, Saudi Arabia-based investment firm. It wasn’t clear how much of Twitter the prince will control.

Prince Alwaleed, a nephew of the Saudi king, ranks 26th on Forbes’ list of the world’s richest people. He has a history of investing in media and technology companies, and he said the deal represents an interest “in promising, high-growth businesses with a global impact.”

Twitter allows users to send short messages of up to 140 characters. The 5-year-old site has been instrumental in connecting protesters and relaying on-the-ground developments during this year’s Arab Spring uprisings.

Globally, the San Francisco-based company has more than 100 million active users who post an average of 250 million messages, or “tweets,” a day.

“We believe that social media will fundamentally change the media industry landscape in the coming years,” Ahmed Halawani, Kingdom Holding’s executive director of private equity and international investments, said in a statement. “Twitter will capture and monetize this positive trend.”

Twitter spokesman Matt Graves confirmed the investment but was unable to provide further details.

Prince Alwaleed owns 95 percent of Kingdom Holding, which also has major stakes in Citigroup, Apple and Rupert Murdoch’s News Corp.

Arabic is now the fastest growing language on Twitter, according to a study released last month by French social media research firm Semiocast. Although Arabic tweets account for just more than 1 percent of all Twitter messages, their volume has jumped in the past year, Semiocast said.

Twitter is growing exponentially, especially in the context of the Middle East,” said Ismail Patel, who follows digital media in the region for the research firm Informa Telecoms & Media. “The Middle East is an important region for Twitter. And Twitter is becoming increasingly important for all Middle East residents … because of the Arab Spring protests.”

Prince Alwaleed is launching a new Arabic news channel, Alarab, that will challenge established players such as Qatar’s Al-Jazeera and Saudi-funded Al-Arabiya. The channel is expected to begin operations next year and will feature reports from business news service Bloomberg L.P.

Prince Alwaleed’s decision to buy into Twitter likely goes beyond his interest in media and technology.

Said Hirsh, a Middle East economist with Capital Economics in London, said rich Arab investors such as Alwaleed have long targeted trophy assets and well-established businesses.

“It is … an investment into a well-recognized brand with future growth potential,” Mr. Hirsh said, adding that Twitter investors such as Prince Alwaleed are unlikely to try to influence the user-generated content on the site. “I … don’t think that there is anything sinister behind it.”

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