Aabar Investments, the Abu Dhabi government-backed investor, has a formed a partnership to target the European property market and technology-based firms. The firm agreed to form a €150 million (Dh783m) joint venture partnership with the Berndorf group of Austria aimed at acquiring attractively priced assets in Europe.
Aabar will contribute €100m in equity funding to the new venture, to be called ABAG, and which will be incorporated in Austria. The global recession has created investment opportunities for oil-rich Gulf investors, which are now building stakes in companies around the world. Aabar, along with its majority shareholder, the International Petroleum Investment Company, which in turn is wholly-owned by the Abu Dhabi Government, are capitalising on years of high oil price proceeds, have been increasingly looking at foreign investments in energy, property, carmaking and financial services sectors.
The investment will allow Aabar to build stakes in mature businesses in the euro zone, according to Ali Khan, the managing director of Arqaam Capital in Dubai. "Perhaps there are not enough businesses of that level of maturity available in GCC or the Middle East," he said. Already this year, Aabar has acquired a 9.1 per cent stake in Daimler, the luxury car maker, and a 4 per cent stake in Tesla Motors, a Californian manufacturer of battery-powered vehicles, an investment which will see the introduction of electric-powered roadsters to the UAE market.
"Aabar never specified any particular areas of investment, which could be a cause of concern for the international investors who want clearly defined investment strategies," Mr Khan said. "On the other hand, a diverse portfolio of investments means different payback cycles, which works in the favour of the firm." Aabar will own two thirds of the new investment firm while the remainder will be held by its Austrian partner, the companies said in a joint statement on the Abu Dhabi stock exchange, where Aabar shares are traded.
Khadem al Qubaisi, the chairman of Aabar said: "We believe ABAG is an excellent platform for Aabar to partner with Berndorf and invest in the growth of medium-sized technology based companies and real estate in Europe." Aabar and Berndorf intend to use ABAG as a long-term investment vehicle. Peter Pichler, the chief executive of Berndorf, said: "In view of attractive prices, there are excellent investment opportunities for long-term oriented investors. The cooperation with Aabar starts exactly at the right point in time."
The partnership with Aabar will enable Berndorf to expand its strategic focus in medium-sized technology based companies in Europe, Mr Pichler said. "With Aabar as our partner, we have the opportunity to scale up our investments," he said, adding that Berndorf's existing portfolio would not be affected. Aabar shares rose 1.5 per cent in Abu Dhabi yesterday to close at Dh1.99. email@example.com