Abu Dhabi Creates $125B SWF

Mubadala Development Company and International Petroleum Investment Company will join forces as Mubadala Investment Company.

Abu Dhabi has merged two of its sovereign wealth funds to form a new investment group, Mubadala Investment Company. 

According to United Arab Emirates news agency WAM, the new sovereign fund combines Mubadala Development Company and International Petroleum Investment Company (IPIC).

The joint venture will “run operations in acquisition, development, construction, financing, operation, and investment in various sectors,” the government said.

The Mubadala Development Company has $63.5 billion in assets under management, its website said. While IPIC’s size is unclear, Reuters reported the newly merged entity will manage a total of $125 billion.

The Abu Dhabi government also named Mubadala Development’s current group CEO Khaldoon Khalifa Al Mubarak to run the new sovereign fund, according to WAM.

A resolution for the merger was first announced in June 2016, when the government said “integrating the two entities would create greater benefits and enhanced economic value to the Government of Abu Dhabi,” according to a WAM report.

“The combined entity will realize synergies and growth in multiple sectors including the energy and utilities sector, technology, aerospace, industry, health care, real estate, and financial investments,” the Emirates said. “It will also have the ability to contribute more significantly to the diversification of the economy, in line with the Abu Dhabi plan and the country’s long-term vision.”

Related: SWFs ‘Not to Blame for Equity Crash’ & Old School Asset Managers, Meet New SWFs

| Sage.Um@strategic-i.com | 646-308-2752