Mubadala to acquire 20% take in Investcorp

Dubai - Mubadala will buy 9.99 per cent of Investcorp immediately, and a further 10.01 per cent following the necessary regulatory approvals

Mubadala, Abu Dhabi state investment fund, will acquire a 20 per cent stake in Investcorp, a Bahrain-based alternative investment firm.
Under the terms of the two-step transaction, Mubadala will buy 9.99 per cent of Investcorp immediately, and a further 10.01 per cent following the necessary regulatory approvals, a statement from Investcorp said without disclosing a value for the transaction.
Mubadala's chief executive Khaldoon Khalifa Al Mubarak said the acquisition of the Investcorp stake is a "logical addition" to its investment portfolio.
Mubadala, which is in the process of merging with International Petroleum Investment Company, or Ipic, another Abu Dhabi state-owned fund, to form a $135 billion combined entity, said the stable and long term value-creation mission of Investcorp makes it a logical addition to Mubadala's diverse financial investment portfolio.
Mubadala's investment strengthens Investcorp's shareholder base, which includes major institutional investors from the UAE, Bahrain and Qatar, in addition to prominent individuals and family offices.
At the end of last year, Investcorp had nearly $11 billion in assets under management. Its current investors and shareholders are mostly from the Middle East and include families, individuals and funds.
"Mubadala is one of the strongest and most respected investment companies in the GCC and globally, so today's development is a significant milestone in the institutionalization of our shareholder base," said Mohammed Mahfoodh Alardhi, Executive Chairman of Investcorp.
Alardh said the investment is a validation of Investcorp's blue-chip brand, our human capital, and our vision for the future. "This is a positive step for our stakeholders, including our shareholders, investors and portfolio companies."
Founded in 1982 by Nemir Kidar, Investcorp provides clients with direct corporate investment (private equity) and real estate investment opportunities as well as a broad array of liquid Alternative Investment Solutions from its offices in London, New York, Bahrain, Riyadh, Doha and Abu Dhabi.
Mubadala, which currently has assets of around $66 billion, owns a wide range of stakes in companies across the globe, including The Carlyle Group and General Electric.
The merger of Mubadala and Ipic  comes close on the heels of  merger talks by National Bank of Abu Dhabi and First Gulf Bank for creating the biggest lender by assets in the Middle East. Both entities roughly have the same amount of assets under management, making it more a marriage of equals that has few overlaps.
Less than 20 per cent of Mubadala's assets are energy-related, whereas for most of Ipic's are in that sector. And while Mubadala's focus is on the Abu Dhabi economy, Ipic mainly invests abroad.
Mubadala also has stakes in Emirates Global Aluminium, the green-energy firm Masdar, the property developer Aldar and a host of other companies.  Ipic owns the Spanish refiner Compañia Española de Petróleos (Cepsa) and the Abu Dhabi diversified investment firm Aabar. It also has stakes in energy companies, such as Austria's OMV, the Austrian petrochemical firm Borealis and the Canadian petrochemical maker Nova Chemicals.
- issacjohn@khaleejtimes.com