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Mubadala set to double exposure to Asia by 2030

Abu Dhabi-based sovereign wealth fund is shifting its attention to emerging markets

Published: Wed 24 Jan 2024, 6:20 PM

By
Issac John

Abu Dhabi sovereign investor Mubadala plans to almost double its exposure to Asia by 2030 as part of its plan to bolster its presence in faster-growing emerging markets.

Of the nearly $300 billion in assets under management, Mubadala has only 12 per cent in Asia today, Camilla Macapili Languille, head of the fund’s life sciences and healthcare investments division, was quoted as saying by Bloomberg.

Mubadala, one of Abu Dhabi’s three main sovereign wealth funds, charged with helping diversify its oil-rich economy, wants to move that number closer to 25 per cent by as soon as 2030, she added.

While investments in North America and Europe make up a chunk of Mubadala’s portfolio, the Abu Dhabi-based sovereign wealth fund is shifting its attention to emerging markets where it is currently “underweight,” namely in China, India, Japan and South Korea, according to Macapili Languille whose unit is in charge of international healthcare investments.

“The US will continue to be a core market for us not only for healthcare but in general for the broader private equity business,” she said. Still, “we have always had an interest in Asia.”

Mubadala’s healthcare investment division will invest between $200 million and $500 million in Asia, compared with up to $1 billion in North America and Europe, the report said.

However, the company is flexible and can increase the investment, Macapili Languille added.

Last year, it combined its health business with G42 Healthcare, creating a new entity called M42 — the largest firm of its kind in the Middle East, according to its website.

“The overall plan for that business does include a potential initial public offering,” Macapili Languille said. Although there are no immediate plans to move in that direction yet, “if an IPO were to materialize, I think that would be a great outcome for that business,” she said.

Global SWF, which tracks the world’s sovereign investment funds, said in its 2024 annual report that three SWFs from the UAE invested a combined $36.5 billion in 2023.

Mubadala was ranked third in the top 10 list of SWFs with investments of $17.5 billion, followed by Abu Dhabi Investment Authority (Adia) with investments of $13.2 billion.

Qatar Investment Authority (QIA) was ranked seventh with deployments worth $5.9 billion. Abu Dhabi’s ADQ took the eighth spot with investments amounting to $5.8 billion.

Mubadala focused on bolstering the UAE’s economic strength with co-investments with ADQ and Brookfield in Dubai-based payments provider Network International Holdings and US-based Resilience in the biopharma sector.

According to Global SWF, one of the most active sellers in the past few years has been Mubadala, which divested $122.7 billion between 2018 and 2022, almost the same figure it had invested.

Several of these exits came from IPIC’s portfolio, including 37 per cent of CEPSA, 64% of Borealis, and 25 per cent of OMV, and from ADIC’s portfolio, including the Chrysler building in New York, and, more recently, 8.0 per cent of Abu Dhabi Islamic Bank.

Other monetisations have come through the private placement or IPO of home-grown powerhouses, such as Masdar, partly sold to Adnoc and Taqa; Aldar, partially divested to Alpha Dhabi; and YahSat, which was taken public.

In January 2023, the UAE SWF completed the sale of 55 per cent of Mubadala Health to G42 for $2.4 billion.

Global SWF expects assets of state-owned Investors, including sovereign wealth funds, public pension funds, and central banks, to reach $54.9 trillion by 2025 and $71.0 trillion by 2030.

By then, Norway’s NBIM, Saudi’s PIF, and Japan’s GPIF will lead the table, with more than $2 trillion in assets under management each, Global SWF said.