Mubadala, the investment arm of the Abu Dhabi Government, is taking its first $100 million (Dh 367m) steps into the Russian markets it said today.
The company will be investing the money into funds managed by Verno, a specialist fund manager in the capital markets of Russia and the Commonwealth of Independent States (CIS) such as Armenia, Belarus, Moldova and Ukraine.
Mubadala Chief Executive Officer Khaldoon Al Mubarak, said: "Russia's recent economic performance and the future potential for the broader region make it an exciting new market for Mubadala.
"Following an analysis of opportunities in Russia, it became clear that the most effective approach to our first investment in the region was to collaborate with a proven local partner.
"We are therefore pleased to announce our partnership with Verno whose leadership has a great track record. We are confident that together we will foster a strategic relationship that will create new investment opportunities for both Mubadala and Verno."
Verno Capital was founded by Dimitri Kryukov, who has 18 years capital markets experience in the region, and his three partners.
Before establishing Verno, Mr Kryukov and his senior team were at Kazimir Partners which delivered annualised returns to investors of 30 per cent from inception in 2002 to 2008.
A statement today said that Verno aimed to attract new funds into the Russian and CIS capital markets and target investors from emerging markets in the Middle East and Asia as well as from the traditional markets of the USA and Europe.
"Mubadala is a world class investor and our partnership offers both organisations the opportunity to capitalise on the dynamic potential of the Russian and CIS markets," said Mr Kryukov.
"At the same time Mubadala is at the vanguard of a new class of investors into Russia. We believe this vote of confidence is a signal to top emerging market investors around the globe."