Sector News

Merger of Abu Dhabi’s IPIC and Mubadala creates $125-billion giant

February 20, 2017

Two Abu Dhabi government-owned investment companies with major interests in the worldwide chemical industry—International Petroleum Investment Co. (IPIC) and Mubadala—have completed their merger to form Mubadala Investment Co.

The new entity will be organized across four investment platforms: petroleum and petrochemicals; technology, manufacturing, and mining; aerospace, information and communications technology (ICT), and renewables; and alternative investments and infrastructure. Mubadala Investment Co. is scheduled to begin operating in May 2017. The company’s investment platforms will help accelerate the diversification of Abu Dhabi’s economy, through investments across critical sectors within the United Arab Emirates and abroad.

Petroleum and petrochemicals account for 31.1% of the new entity’s total assets, including significant investments in companies such as Cepsa, Nova Chemicals, Borealis, and Mubadala Petroleum. The alternative investments and infrastructure segment accounts for 31% and has significant equity investments worldwide in sectors such as health care and real estate. Technology, manufacturing, and mining represents 21.6% of Mubadala Investment Co.’s total and includes investments in Global Foundries, Emirates Global Aluminium, AMD, and Matsa. The aerospace, ICT, and renewables unit is the smallest, accounting for 10.6% of total assets. It includes investments in Yahsat and Masdar. Corporate assets, including cash, will hold the balance of 5.7% of the approximately 460-billion Emirati dirham ($125 billion) portfolio.

“Committees comprised of Mubadala and IPIC leaders have worked very hard over the past six months to put in place a proposal for a structure that will best serve the new company’s mandate,” says Khaldoon Khalifa al-Mubarak, managing director and CEO of Mubadala Investment Co.

By Natasha Alperowicz

Source: Chemical Week

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