Mubadala plans co-investments with Chinese group

Deal1Mubadala, one of Abu Dhabi’s sovereign wealth funds, has signed a deal to work with HNA Group, based in Hainan, China, to make co-investments in tourism, logistics and financial services.

The agreement builds on a transaction revealed in July in which Mubadala sold its majority stake in SR Technics, a Swiss maintenance company, to HNA Group.

“This agreement will create opportunities to build on the deep rooted relationship between the UAE and China,” said Homaid Al Shimmari, chief executive of aerospace and engineering services at Mubadala.

Mubadala, which is structured as a state-owned holding company, reported a loss of nearly 5 billion dirhams ($1.4 billion) in the first half of the year. It blamed “lower commodity prices, decreased gains from financial investments, higher depreciation and impairments” for the the decline.

The fund, which is tasked with investing Abu Dhabi’s oil wealth in sectors that yield social benefits, is due to be merged with another of Abu Dhabi’s state funds, the International Petroleum Investment Company.

Adam Tan, chief executive of HNA Group, said: “This agreement is reflective of how HNA Group and Mubadala are working together to embrace the One Belt, One Road initiatives aimed at enhancing and strengthening connections between China and EMEA [Europe, the Middle East and Africa] through commercial, investment and cultural exchanges.”

One Belt, One Road is the name for a Chinese government policy to promote trade by land and sea with much of the globe.

©2016 funds global mena

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