The Carlyle Group, a US private-equity company partly owned by Mubadala Development, is expecting a valuation of US$7.5 billion (Dh27.54) to $8bn after its IPO on the Nasdaq stock exchange, according to sources familiar with the matter.
Through its affiliates, Mubadala, a strategic investment company owned by the Abu Dhabi Government, acquired a 7.5 per cent stake in Carlyle in September 2007, which was raised to 9.35 per cent in 2010.
A 9.35 per cent stake in Carlyle would be worth $748m at the top end of the company's IPO price expectations.
"Mubadala and The Carlyle Group have been strategic partners in a number of areas," said a Mubadala spokesman. "As long-term investors, we intend to remain strategic partners, and we remain supportive shareholders of Carlyle."
Carlyle, which is beginning a global roadshow as part of its listing on the Nasdaq, hopes to float about 10 per cent of its share capital.
Mubadala, which is expected today to publish its full-year earnings for 2011, is prohibited from buying more than 19.9 per cent of Carlyle's stock.
Mubadala invested in the Washington-based company as the second strategic investor, after the Californian state pension fund, CalPERS, which had been an investor since 2001.
Carlyle declined to comment.
Founded in 1987, the company became one of the world's biggest buyout firms, and its imminent IPO is expected to further enrich the founders, William Conway Jr, Daniel D'Aniello and David Rubenstein.
The company's alumni include the former US president George HW Bush and the former UK prime minister John Major.
Mubadala waived its right to nominate a member of the board as part of the terms of its investments.
Carlyle generated a profit of $1.35bn last year, with revenue of $2.8bn in the same period, its IPO filings show. The firm had total assets of $24.6bn at the end of last year.
Partnerships with private-equity firms had in the past been sought to bring benefits other than solely investment gains for Gulf sovereign wealth funds, said Rachel Ziemba, an analyst of sovereign wealth funds and Gulf economies at Roubini Global Economics.
"Mubadala and other sovereign funds saw their investments as partnerships with private-equity firms as a way of increasing their access to a variety of investment opportunities and a source of expertise," she said.
Since the financial crisis, valuations of private-equity firms have declined, Ms Ziemba added.
"There has been a structural shift in the alternative-investment world. Leverage is never going to be as cheap as it was then," she said.