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Mubadala Gets ‘AA’ 
Rating, ‘Stable’ Outlook

ABU DHABI — Fitch Ratings has affirmed Mubadala Development Company’s long-term issuer default rating, or IDR, and its senior unsecured rating as ‘AA’.

The Abu Dhabi-based group’s short-term IDR has been affirmed at ‘F1+’, with a ‘stable’ outlook.

The rating also affects the company’s global medium-term note programme, or GMTN, which remains rated at ‘AA’. Mubadala’s rating is aligned with Abu Dhabi’s sovereign rating which is ‘AA’/stable). Mubadala’s development mandate has been supported by significant capital contributions from the government. As of 31 December 2008, the government’s cumulative capital contributions into the company since its establishment totalled Dh39.2 billion and the government has approved further capital contributions of up to Dh21 billion in 2009. Between December 31, 2008 and June 30, 2009, Mubadala received additional shareholder contributions totalling Dh8.8 billion.

“Mubadala is at a relatively early stage in its development and is investing substantially in new projects. As a result, it is currently experiencing strong growth, and its capital and investment expenditures are comparatively high in relation to its revenues and operating income,” the rating agency said in a statement on Wednesday.

“Mubadala is focused on developing and managing an extensive and economically diverse portfolio of commercial initiatives, based on long term capital intensive investments that deliver strong financial returns. The company manages a multi-billion dollar portfolio of local, regional, and international investments, projects and initiatives,” it added. The company’s results from operations for 2008 have been adversely affected by the global economic downturn, particularly by the decline in stock market valuations and global oil prices during second half of 2008. The economic downturn has also adversely affected commercial real estate prices in Abu Dhabi and elsewhere in the country, as well as the availability and terms of financing.

Despite adverse market conditions, Mubadala continues to retain strong access to debt capital markets and bank lending. Since December 31, 2008, it has issued $1.85 billion of notes under its GMTN programme.

· —haseebhaider@khaleejtimes.com