Abu Dhabi government-owned investment fund Mubadala posted a first-half loss of Dh4.5 billion ($1.23 billion) due to a fall in the value of its investments and said it would triple its capital base.

The investment fund, which has stakes in Advanced Micro Devices Inc and Ferrari, said the results reflected an unrealised loss of Dh4.4 billion on its investments in local and global markets.

'The company recognizes that share price fluctuations will have a positive or negative effect on its periodical reporting of financial performance,' Mubadala said in a statement on Thursday.

Mubadala, which is also a shareholder in General Electric and private equity firm Carlyle, said its board approved plans to increase share capital to 15 billion from Dh5.5 billion currently through conversion of certain shareholder rights. The capital plan is currently in the process of being formalised, it said.

Total assets under management stood at Dh86.1 billion at the end of the first half, Mubadala said in the statement.

The investment firm had assets of Dh88.5 billion at the end of 2009.

First-half revenue from operations grew to Dh8 billion, an increase of Dh2.1 billion over the year-ago period, driven by strong performance in its aerospace, infrastructure, and oil and gas businesses, Mubadala said.

Operating income at its oil and gas segment rose 44 per cent to Dh3.6 billion, while operating income at its aerospace segment rose 20 per cent to Dh2.5 billion.

Operating income at Mubadala’s infrastructure segment grew 21 per cent to Dh1.7 billion from Dh1.4 billion.

Total equity decreased 4.7 per cent to Dh46.6 billion in the first half of 2010 from Dh48.9 billion in December 2009.

Along with its international holdings, Mubadala also owns stakes in local firms including UAE telecom operator du and developer Aldar Properties.

In July, Mubadala Aerospace said it expected to seal aircraft component leasing deals worth up to $500 million this year and was eyeing acquisitions in the United States and Asia.

“Mubadala is a young and dynamic company with a very promising portfolio of assets,” said Khaldoon Khalifa Al Mubarak, Mubadala CEO and managing director.

“As long term holders of substantial and strategic positions in leading local and global companies, we will experience some unrealized losses and gains during our holding period.”

“We remain focused on building a strong and diversified portfolio of assets, and delivering tangible social contributions to Abu Dhabi,” he added. – Reuters