Mubadala Investment Company, an Abu Dhabi sovereign investor, has grown its portfolio with assets under management (AUM) reaching more than AED1.1 trillion ($300 billion), in a tumultuous year.
In line with its strategy of focusing on innovation-centric industries, Mubadala deployed AED89 billion into a range of sectors shaping the future, including artificial intelligence, technology, digital infrastructure, life sciences and clean energy, while growing its private credit business.
The company capitalised on market opportunities to execute on its monetisation strategy, generating total proceeds of AED99 billion for the year.
Capital deployment
Mubadala built on its role as a global investor through opportunistic capital deployment in North America, Asia and Europe in sectors key to regional growth. Investments to accelerate the transformation of the UAE economy through AI-enabled innovation in sectors such as healthcare and space technology remained central to Mubadala’s strategy.
Khaldoon Khalifa Al Mubarak, Managing Director and Group CEO said: “Mubadala had a strong year across the portfolio, making investments in areas essential to growth and innovation around the world. Our foundational investments in industries shaping the future are positioning Mubadala as a global investor in solutions to support human progress. Globally, we continue to strengthen our presence and partnerships in key markets, ramping up investments across a range of sectors in line with our convictions.”
Mubadala invested in Aligned, one of the fastest-growing data centre providers in the Americas. Through its portfolio company Mubadala Capital, Mubadala announced it would acquire Fortress, a world-leading investment manager, from the Softbank Group. Mubadala also completed the acquisition of its stake in GlobalConnect, a leading fibre-based data communication and data centre services provider serving enterprises, public institutions, and consumers in Northern Europe. Masdar, the global clean energy powerhouse established by Mubadala in 2006 closed on a 50% stake in the Big Beau combined solar and battery storage in California from EDF Renewables North America.
In Asia, GlobalFoundries - which was created by Mubadala in 2009 - announced the official opening of a $4 billion semiconductor fabrication plant in Singapore. Mubadala also invested alongside KKR in CoolIT Systems, a leading provider of scalable liquid cooling solutions for the world’s most demanding computing environments and invested in Osstem dental care in South Korea. Mubadala Energy also made one of the largest natural gas discoveries in Indonesia, in December, with the potential of up to 170 billion cubic metres.
Two new businesses
In the UAE, Mubadala founded two new businesses alongside Abu Dhabi’s technology group G42. Space42 is a home-grown space and satellite technology champion, created through the merger of its satellite company Yahsat and AI-enabled geospatial solutions company Bayanat. Mubadala and G42 also made strategic investments in the growing healthcare sector including the creation of M42, a first-of-its-kind, tech-enabled, integrated healthcare company.
Mubadala and G42 are also foundational partners in Abu Dhabi’s MGX, a comprehensive investment vehicle to accelerate the development and adoption of AI and advanced technologies.
Mubadala expanded its private credit business during the year. Mubadala and Ares formed a joint venture, aiming to deploy approximately $1 billion to capitalise on the anticipated growth and substantial demand for customised liquidity solutions for the credit secondaries asset class.
With Ares and Aldar, Mubadala also established a new strategic partnership to jointly invest $1 billion in European private real estate credit. Mubadala also created a long-term partnership with Apollo to invest alongside partners up to AED9 billion over the next five years in credit opportunities.
Steady rate of return
Group Chief Financial Officer, Carlos Obeid, said: “In 2023, global markets experienced significant turbulence across various sectors and industries, driven by rising interest rates, inflationary pressures, geopolitical tensions and supply chain disruptions. Despite these challenges, our five-year rate of return stood at 10.3%.”
Obeid added: “Complementary to our growth in AUM, 2023 marked a year of prudent debt raising where we successfully executed almost AED30 billion of funding commitments obtained across a diverse range of products, strategically issued to refinance maturing debt, and to also to support Mubadala’s investment activities in line with our exciting growth plans. As part of these debt issuances, we successfully executed our inaugural Green Bond in October following the establishment of our Green Financing framework to commemorate Mubadala’s decision to align with the UAE’s commitment to Net-Zero by 2050, during COP28. We continue to maintain a relatively interest rate immune debt portfolio with a conservative gearing ratio of 10.3% and a strong liquidity position to navigate through this cycle.”
Key financial and operational highlights
•A five-year cumulative rate of return of 10.3%
•AED89 billion capital deployment in line with strategy, including technology, digital infrastructure, life sciences, renewable energy and private credit
•Portfolio mix broadly similar year on year, with 38% direct and indirect in private equity, 25% in public markets and 16% in real estate and infrastructure
•AED99 billion in proceeds including divestments of certain legacy assets and capital recycling into priority investment areas in line with strategy and responsible investing agenda
•Assets Under Management grew to AED1.1 triillion, compared to AED1.02 trillion in 2022 - a 9.45% increase
•Gearing ratio of 10.3%, with a very strong liquidity position. TradeArabia News Service
