Mubadala raises first tranche of infrastructure fund

Mubadala has raised Dh1.1 billion, in spite of speculation that sourcing the finance would be difficult.

Mubadala has raised US$300 million (Dh1.1 billion), the first tranche of its regional infrastructure investment fund. The Abu Dhabi Government sovereign-backed fund plans to raise a second US$200m tranche in the coming months. There had been speculation it would be difficult to raise the planned $500m, but according to Waleed al Mokarrab al Muhairi, the fund's chairman, the fund-raising was on course.

The holding company, Mubadala Infrastructure Partners (MIP), as the manager of the fund, will invest in infrastructure projects and assets in GCC countries, the MENA region, and Turkey. "The fund is an important vehicle that allows for local and international institutional investment participation in regional infrastructure," said Mr Muhairi. "The development of the infrastructure sector is and will continue to be a critical driver of economic growth in the region. This first closing is a testament to the strength of our partnership with GE and Credit Suisse as well as the interest level from regional and international investors in the asset class and the region."

MIP was established last year and is run from Abu Dhabi. Despite the global financial crisis and a liquidity crunch, Charles Pieper, vice chairman of alternative investments at Credit Suisse, said the strength of the region's economy and infrastructure development plans made investment compelling. "Our partnership in Mubadala Infrastructure Partners underscores our commitment to the region, and we believe the MENA region continues to be a good place in which to invest, given the strength of its economy and infrastructure development plans," he said. "We look forward to deepening our relationships with our investor partners going forward."

Mubadala's sole shareholder is the Government of Abu Dhabi. It manages a multi-billion dollar portfolio of local, regional, and international investments, projects and initiatives most particularly in sectors such as energy, aerospace, real estate, health care, technology, infrastructure, and services. "We are actively pursuing transactions throughout the region with an emphasis on investments in development and operating assets and businesses," said Philip Haddad, chief executive of MIP. "Our comparative advantage lies in the flexibility of our business model, our extensive relationships and our team."

"GE has a growing presence in the region and this fund will help us expand and capitalise on opportunities there, as well as continue to build the strategic relationship with Mubadala announced last summer," said Aris Kekedjian, chief executive of GE Capital in the Middle East and Africa. [e-mail]