The venture capital arm of Mubadala has forged a US$2.1 billion private equity partnership with Ardian, which will see the French investment house provide capital in a portfolio of assets and funds managed by the Abu Dhabi sovereign fund.
Ardian and Mubadala Capital have organised a portfolio of 10 limited partnership interests with a leading group of general partners predominantly in North America and Europe, as well as six high-quality direct investments. The assets were spun off from Mubadala Capital’s balance sheet in 2021. The agreement builds on a US$2.5 billion investment deal between the two in 2017, which also included the creation of a private equity fund.
Mubadala Capital’s CEO Hani Barhoush said, “This transaction is a significant vote of confidence in our ability to create value for our investors and partners by executing against our strategy.”
Mubadala Capital was established in 2011 and now manages a portfolio, including third-party capital vehicles, that was worth US$13.7 billion at end-2021 and currently estimated at around US$17 billion. Its strategies also include venture investing, public equities and a fund focused on Brazil. So far this year, the SWF has committed an estimated US$6 billion to private equity deals, excluding infrastructure and real estate.
An experienced VC investor, Mubadala is less risk-averse and, since the full deployment of SVF1 in 2020, it has sought to emulate its tech-oriented early-stage strategy. So far in 2022, Series A and B rounds made up 53% of its deal volume, up from 43% in 2021, as the Mubadala Capital team gained more autonomy and sought potentially high growth private equity. Notably, the Abu Dhabi investor is making the most out of its closer relations with Israel with US$100 million invested in Israeli VC asset managers to gain exposure to the country’s sophisticated disruptive tech sector, following the Abraham Accords signed in 2020.
Ardian is not the only investment house favored by the Emirati state-owned investor. Mubadala also has a long-standing collaboration with BlackRock with a relationship the two sides claim works very well. The asset manager acquired a portfolio of assets from Mubadala’s first private equity fund, which launched in 2017 with US$2.5 billion of capital raised, and gave a US$400 million commitment to its US$1.6 billion MIC Capital Partners III fund, launched in 2019. In 2020, Mubadala was one of an array of institutional investors and sovereign funds that participated in the acquisition of PNC Financial Services Group’s US$14 billion stake in BlackRock. Last year, they agreed a US$1.2 billion partnership in August in which BlackRock contributed US$700 million.
In August, BlackRock Real Assets and Mubadala completed the first tranche of their planned INR40 billion (USD502 million) investment in the renewable energy arm of India’s Tata Power, giving them a combined 10.5% stake. Tata Power Renewables began the year with some 5GW with a five-year goal of 20GW.
