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Abu Dhabi state investment arm takes stake in Carlyle

Abu Dhabi principal investment company Mubadala Development Company has agreed to acquire a 7.5 percent stake in the Carlyle Group for USD1.35bn in cash, representing a 10 per cent liquidi

Abu Dhabi principal investment company Mubadala Development Company has agreed to acquire a 7.5 percent stake in the Carlyle Group for USD1.35bn in cash, representing a 10 per cent liquidity discount to the parties’ agreed-upon USD20bn firm valuation.

The investment carries no associated voting rights and is subject to value-related protective rights. As part of the transaction, which is expected to close next month, Mubadala has also committed USD500m to an investment fund managed by Carlyle.

Mubadala joins the California Public Employees’ Retirement System, which purchased a 5.5 percent stake in Carlyle in 2000, as a strategic investor in the private equity firm. Goldman Sachs advised Mubadala on the transaction, while Citigroup Global Markets advised Carlyle.

‘Speaking on behalf of my fellow co-founders William Conway and Daniel D’Aniello, Mubadala is among the most sophisticated investors in the world and we are honoured to have them as long-term partners,’ says Carlyle co-founder David M. Rubenstein.

‘We feel this is an affirmation of the global business model we have created and a reflection of Carlyle’s 20-year record of top-quartile returns. These resources, like the earlier investment by CalPERS, will add to Carlyle’s capital base, strategically expand our business and be used for additional investments.’

Mubadala chief executive Khaldoon Al Mubarak says: ‘Carlyle’s outstanding returns, broad portfolio and global presence are a tremendous fit for Mubadala’s regional expertise, accelerating growth and international expansion. We are excited about the potential for this partnership and our future relationship together.’

Carlyle is a global private equity firm with 900 employees operating in 21 countries and managing USD76bn in capital committed to 55 funds. Since 1987, Carlyle has invested USD34bn in 686 transactions, returned USD32.5bn in equity and gain to its investors, and has USD30bn in remaining value in its investments, as well as USD32bn in capital available to invest.

Mubadala Development Company seeks to create long-term returns as an engaged investor in high-performing businesses and promising new ventures. The company employs 250 staff and is a principal investor in and manager of large-scale industry leading ventures throughout the Middle East and North Africa region.

The company has significant interests in sectors such as energy, heavy industry, telecommunications, infrastructure and aerospace, including Dolphin Energy, the largest natural gas project in the Middle East, and a joint venture to construct and operate one of the world’s largest aluminium smelters.

The company also manages a growing and diversified international portfolio that includes significant stakes in the Dutch automobile fleet management giant LeasePlan Corporation and Swiss aircraft and engine services provider SRTechnics, as well as a 5 per cent shareholding in the Italian luxury automobile constructor Ferrari.

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