As a youngster he also kept accounting ledgers of what he earned and spent and bought a government savings bond from which he learned valuable lessons about compound interest.
More than half a century later Slim, 70, has amassed a fortune of $53.5 billion, beating Microsoft founder Bill Gates to top the list of the world’s richest people, according to a new ranking published by Forbes magazine.
His far-flung business empire includes some of Mexico’s best-known department stores, its biggest telecoms operator, hotels, restaurants, oil drilling, building firms and Inbursa bank (GFINBURO.MX) — making it hard to go a day in Mexico without paying him some money.
Outside Mexico Slim has holdings in such prestigious groups as retailer Saks (SKS.N) and New York Times Co (NYT.N).
His defining foray occurred in 1990 when he and his partners bought creaking state telephone company Telmex (TELMEXL.MX) for $1.7 billion. Turning it into a cash-making jewel, he spun off America Movil (AMXL.MX) and expanded it through acquisitions to become the world’s No. 4 wireless operator.
While critics accuse him of using a monopoly to build his fortune, Slim has a simple philosophy about making money.
“Wealth is like an orchard,” he told Reuters in 2007. “With the orchard, what you have to do is make it grow, reinvest to make it bigger, or diversify into other areas.”
Cigar-smoking Slim’s trademark is his “Midas” touch, acquiring struggling firms and turning them into cash cows.
In 2008, he bought a minority stake in the New York Times as the stock tanked. Now, warrants he received for lending the publisher $250 million could net him more than $80 million and could lead to a 16 percent stake in the company for Slim, who says he has no interest in becoming a U.S. media baron.
But Slim’s newspaper investment has ruffled feathers in the New York media establishment. As investors speculated last week that he could move to acquire more of the Times, media mogul Rupert Murdoch said he doubted the controlling family would relinquish control to an outsider, especially from abroad.
Slim learned his first business lessons from his father, Julian Slim Haddad, a Lebanese immigrant who came to Mexico in the early 1900s, opened the “Star of the Orient” general store and bought properties cheap during the Mexican Revolution.
In 1987, when stocks nosedived during one of Mexico’s many crises, Slim saw opportunities where others feared disaster, picking up low-priced shares and selling when they recovered.
“We know that crises are always temporary and there is no evil that lasts 100 years, there is always an overshoot,” Slim once said. “When there is a crisis that provokes an adjustment, an overreaction comes along and things get undervalued.”
Slim’s enormous wealth stands starkly against his frugal lifestyle. He has lived in the same house for about 40 years and drives an aging Mercedes Benz, although it is armored and trailed by bodyguards. He eschews private jets, yachts and other luxuries popular among Mexico’s elite.
After studying engineering, Slim founded a real estate company and worked as a trader on the Mexican stock exchange.
His wealth growing, he opened a brokerage in the mid-1960s and a decade later he began his trademark trait of buying failing businesses, including a cigarette company. He acquired department store and cafe Sanborns, a mine operator and manufacturers of cables and tires.
By 1990 Slim had built the fortune he used with partners to buy Telmex and launch his telecoms empire. America Movil now has 201 million customers from Brazil to the United States.
Slim has handed over the day-to-day operation of his companies to his three sons and loyal business partners but remains clearly in charge when appearing with them at media events.
He has become involved in combating poverty, illiteracy and poor healthcare in Latin America and promotes sports projects for the poor, but has never voiced plans to give chunks of his wealth to charity like Gates or fellow billionaire Warren Buffett.
Businessmen, he says, do more good by creating jobs and wealth through investment, “not by being Santa Claus.” Reuters