Mubadala Deal Making Surges

UAE sovereign wealth fund uses extra scale to compete for deals

- Mahmoud Habboush and Dinesh Nair, with Roger Field

While Saudi Arabia’s sovereign wealth fund might be attracting all the hype, business is brisk a little to the east in Abu Dhabi.

Mubadala Investment Co., which doubled in size after a tie-up with another local fund, is using its new scale to compete for global deals and sell assets. Since the start of 2017, it’s completed 31 deals, according to the Sovereign Wealth Fund Institute (SWFI), with more in the works. In comparison Saudi Arabia’s Public Investment Fund completed 16 deals.

“Mubadala has always been an active investor, but in the past two years the focus has been shifting away from operational assets to investing,” said Rachel Pether, a senior adviser at the SWFI. “Although Mubadala has a long-term horizon, it’s only natural that they monetise assets when the capital can be better deployed elsewhere.”

Created in 2002, Mubadala is part of Abu Dhabi’s effort to diversify its economy by turning oil revenue into profitable investments, while attracting technology and jobs to the emirate.

After combining with Abu Dhabi Investment Council in March, Mubadala became an entity with more than $250 billion of assets, enough to join an exclusive club of sovereign wealth funds and national state pension plans that compete globally with private equity for the largest acquisitions.