Several big name private equity firms including Ardian, Brookfield, Tikehau Capital and CVC, have all established offices in the Gulf recently as they look to tap into the resources of the region’s cash-rich sovereign wealth funds and families, according to a report by Reuters.
The report cites data from research firm Preqin as highlighting that the rush to the Gulf has come as traditional sources of funding for buyouts have dried up with global fundraising for alternative investments, which include private equity, dropping 21% to $972bn in the year to 1 November from the same period a year earlier.
And with their money now a more important source for funding for private equity firms, Gulf investors and SWFs are expecting a local presence.
The report quotes Francois Aissa-Touazi, Co-global Head of Investor Relations at Ardian, as saying that: “Building a partnership based on reciprocity is nowadays necessary to succeed in the Gulf.”
Ardian opened an office in Abu Dhabi in January, while Canadian asset manager Brookfield recently opened an office in Riyadh and plans to open another in Abu Dhabi. European buyout group Tikehau Capital also opened an office Abu Dhabi this year, while CVC opened an office in Dubai last year.