How the world's billionaires are handling the Covid-19 outbreak
In our fortnightly round-up, Richard Branson pivots from rockets to ventilators and David Geffen’s seclusion on a luxury superyacht draws outrage
Richard Branson’s rocket-launch company is looking to join the rush to make ventilators, as a shortage of the life-saving equipment looms because of the coronavirus pandemic.
Virgin Orbit is trying to start producing a simple type of medical ventilator in April at a rate of several hundred a week, spokesman Kendall Russell said on Monday. The company is working with the Bridge Ventilator Consortium, an effort led by the University of California at Irvine and the University of Texas at Austin.
The company is awaiting US Food and Drug Administration approvals for its design, which would provide respiratory assistance without the size and expense of larger and more sophisticated models, Mr Russell said. Virgin Orbit would also give the ventilator an open-source design so that other companies could build the model.
The California company has about 75 per cent of its employees working remotely because of the virus. Mr Branson founded Virgin Orbit to handle smaller payloads, with its rocket launched from the wing of a Boeing 747 jumbo jet. The company is preparing for a flight test with a fully loaded rocket.
Governments across the globe have appealed to car makers and aerospace companies to help procure or make ventilators and other medical equipment amid the fast-spreading coronavirus outbreak.
Earlier this week, Ford said it will produce 50,000 ventilators over the next 100 days at a plant in Michigan in co-operation with General Electric's healthcare unit, and can then build 30,000 per month as needed to treat patients afflicted with the coronavirus.
General Motors expects to start making ventilators in mid-April, ramping up to a rate of 10,000 per month as quickly as it can.
Tesla chief executive Elon Musk said in a tweet on Tuesday the company has extra FDA-approved ventilators that can be shipped free of cost to hospitals within regions where the electric carmaker delivers.
As for Mr Branson's other Virgin Group businesses, he faced a social media firestorm after Virgin Atlantic called for as much as £7.5 billion (Dh34bn) in UK aid for the aviation industry and appealed to its workers to take unpaid leave.
He tempered criticism with a blog post on March 26 that he’d invest $250 million (Dh918m) in Virgin Group to support operations hit by the virus and a growing recognition that Virgin Atlantic’s measures, which were largely backed by its employees, were necessary for an industry in almost complete shutdown.
“This is the most significant crisis the world has experienced in my lifetime,” he wrote. “We can hopefully emerge and thrive with as many jobs as possible intact once the situation stabilises.”
American business magnate David Geffen’s picture-perfect self-seclusion on a luxury superyacht has drawn outrage, highlighting ugly divisions in the age of the coronavirus pandemic.
“Isolated in the Grenadines avoiding the virus,” the billionaire, 77, said in an Instagram post. “I’m hoping everybody is staying safe.”
The photos of his luxury confinement aboard the 454-foot Rising Sun, one of the world’s biggest private vessels, triggered an immediate social-media backlash last weekend.
“This is just shameful and grotesque,” American columnist and TV personality Meghan McCain tweeted on March 28, one of thousands of critical comments.
Mr Geffen, who has a net worth of $9bn, according to the Bloomberg Billionaires Index, made his Instagram account private soon after the post.
Mr Geffen’s Caribbean excursion is the latest revelation of how the crisis is affecting people unequally across the globe. While the world’s wealthy have fled to holiday homes, specially made bunkers or floating palaces, rank-and-file workers from nurses to supermarket cashiers have been left juggling childcare and risking infection working jobs deemed essential.
The Rising Sun has been in the Caribbean since mid-November and has sailed back and forth between Grenada, St Vincent and the Grenadines since February. Built for Oracle founder Larry Ellison, the yacht is equipped with a gym and cinema. It’s not the only billionaire’s boat in the Caribbean, with Roman Abramovich’s Eclipse and Ernesto Bertarelli’s Vava II also dropping anchor in the region.
While the ship may seem like a floating haven, the risk of a guest or crew member becoming ill could see the getaway “quickly turn into a quarantine nightmare”, according to industry publication Superyacht Times.
Daniel Kretinsky, the owner of a $7.8bn Czech energy conglomerate EPH, said he tested positive for coronavirus on March 12 and has been self-isolating himself since then.
Mr Kretinsky told newspapers E15 and Blesk, which both belong to his media unit, that he is running his businesses remotely and spends 12 hours a day on the phone. He said he has not developed symptoms, such as fever or coughing, and only had a light cold.
The billionaire said energy companies are hit by the global pandemic but the blow isn’t “fatal”. Media businesses are in a more complicated position because of lack of advertising revenue, Mr Kretinsky said, adding he’ll continue to diversify outside the energy sector.
“The energy industry is key for us but opportunities for attractive growth are limited there,” Mr Kretinsky said. The group may look for assets in the US, which would be rational but difficult, he added.
Mr Kretinsky turned EPH from a small Czech utility into one of the biggest power companies in central Europe in about a decade of debt-fuelled acquisition spree. The group had revenue of €7bn (Dh28bn) in 2018 and valued its assets in Czechia, Slovakia, Germany, Italy, the UK, Hungary and Poland at about €13.3bn.
The billionaire’s media investments include stakes in French newspaper Le Monde and German entertainment company ProSiebenSat. 1 Media as well as several Czech news publications.
The 44-year-old has a current net worth of $3.4bn, according to Forbes.
Los Angeles Clippers owner Steve Ballmer said his team would lose at least $10m this season, offering the first glimpse into how much money the suspension of the season might cost National Basketball Association franchises.
“It’ll be eight digits,” the former Microsoft chief executive said in an interview with Bloomberg Television on March 27. “Now you’ve got to start with what we were either going to make or lose before the season started, but net, net, net, it’ll certainly be an eight-digit loss for us.”
The NBA suspended its season on March 11 after a player tested positive for the Covid-19 virus. Since then, the US has become the worldwide centre of the pandemic, with more than 190,000 people infected, surpassing China and Italy.
The association is working on a number of possible scenarios in which it can play at least a portion of the regular season and playoffs, Mr Ballmer said.
“It’d be great to play some basketball, but only if the time is right and the circumstances are right,” he added.
Mr Ballmer is the wealthiest NBA owner, with a net worth of $55.1bn, according to the Bloomberg Billionaires Index. He bought the club for $2bn in 2014.
Mr Ballmer said he is paying team and arena employees, as well as vendors, even though games aren’t being played. He specifically cited a T-shirt vendor that received a $100,000 commitment from the team to produce playoff merchandise.
“We are being diligent about continuing to pay our employees. We’re fortunate. We’re deep pocketed,” he said. “Yes, we’ll lose money. At the same time that’s going to be true for a lot of businesses. I’ve been very fortunate.”
Updated: April 4, 2020 04:13 PM