Mubadala is ending the year with the sale of one of its longest-held and biggest assets, a 25% stake in Austria-based oil producer OMV, as it continues its post-merger portfolio rebalancing.

While the terms were not revealed, based on OMV’s current share price the deal is likely to be worth at least US$4.2 billion. The divestment is the third big sale by the Abu Dhabi sovereign wealth fund in 2022. Earlier in the year, Mubadala and Trafigura sold Spanish copper miner Minas de Aguas Teñidas (MATSA) for US$1.87 billion. This was followed in July by the sale of four prime Grade A commercial towers valued at US$1.2 billion in Abu Dhabi Global Market, the international financial centre in Abu Dhabi, to Aldar Properties, in which Mubadala holds a 25% stake.

In common with other sovereign wealth funds, Mubadala is revamping its structure and seeking to become nimbler in grasping opportunities as it sets out to achieve AUM of nearly US$500 billion by 2030. The Abu Dhabi government had already consolidated Mubadala with two of other state-owned investors operated by the emirate: the International Petroleum Investment Co. (IPIC) and the Abu Dhabi Investment Council (ADIC).

Divestment from chunky legacy assets have formed a significant feature of Mubadala’s strategy since it was merged with the International Petroleum Investment Company (IPIC) in 2017, and it subsequently absorbed the Abu Dhabi Investment Council (ADIC) in 2019, although it has not fully integrated it yet. Mubadala has a deep focus on capital intensive industries such as aerospace, real estate, semiconductors, healthcare and renewable energy, including Masdar.

Mubadala is recycling the dry powder provided by its divestments for the purpose of venture capital and diversification. Last week, 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. The sale of the OMV stake will enable Mubadala to commit to developing its limited partnership interests.

The divestment from OMV comes hot on the heels of Mubadala’s investment in German offshore wind developer Skyborn Renewables, alongside Global Infrastructure Partners. Its acquisition is worth potentially around US$2.5 billion.

The GlobalFoundaries IPO was one of the biggest in the US in 2021, after Coupang and DiDi Global, but excluding SPACs; the SWF still retains 89% of the company’s shares. Yahsat’s IPO attracted strong demand, raising about US$731 million  and representing the first major IPO on the Abu Dhabi bourse since Abu Dhabi National Oil Co Distribution was listed in 2017.

 Mubadala’s exits in 2020 included chunky stakes in Energias de Portugal, Borealis, Aldar Properties, Unicredit and Torresal Energy – together valued at nearly US$11 billion. The Abu Dhabi fund staged an IPO of its wholly owned satellite communications firm Al Yah Satellite Communications Company (Yahsat) on stock exchanges in July. It attracted strong demand, raising about US$731 million, and representing the first major IPO on the Abu Dhabi bourse since Abu Dhabi National Oil Co Distribution was listed in 2017.

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