Mubadala Investment Company’s units, Strata and Sanad, are on track to become global leaders in the aerospace industry as they diversify and expand their operations, according to a senior executive.
Based in Al Ain, Strata manufactures aircraft components and has billion-dollar contracts with Boeing, Airbus, Leonardo in Italy and Switzerland’s Pilatus Aircraft.
Sanad was formed in 2019 after Mubadala merged three of its units – Sanad Aerotech, Sanad Powertech and Sanad Capital.
It provides financing, leasing and maintenance services to the global aerospace, energy and industrial sectors.
“Strata started off with small parts – secondary parts – and today Strata makes one of the largest components outside of the US in its facility in Al Ain by Emiratis, mainly women ... and that is a success,” Badr Al Olama, executive director, UAE clusters at Mubadala, said on Tuesday. He was speaking at the Global Aerospace Summit, being held in Abu Dhabi until Thursday.
The UAE is diversifying its economy and expanding its manufacturing sector to reduce its reliance on imports of industrial inputs, a drive given impetus by Covid-19, which has disrupted world trade since 2020.
Last year, the Arab world’s second-largest economy revealed plans to increase the manufacturing sector’s contribution to the country’s economic output to Dh300 billion ($81.68bn) from Dh133bn over the next decade, as well as boost local production and create light and heavy industries.
“Sanad is profitable and Strata is on track [to] profitability and both of them, they developed the supply chain, they developed the ecosystem and are on track to become global leaders,” Mr Al Olama said.
Strata expected revenue of $80 million to $100m in 2021, similar to the levels of 2020, its chief executive, Ismail Abdulla, told The National last year.
The company plans to expand its manufacturing capabilities to include more segments in the industrial sector, covering biopharma, advanced materials manufacturing, digitisation and automation as part of its long-term strategy announced this year.
“We will not only double down on our aerospace manufacturing capability but also intend to have a larger contribution on the UAE’s manufacturing and socioeconomic growth … by diversifying our manufacturing portfolio,” Mr Abdulla said at the time.
Under the agreement, the companies plan to exchange knowledge and work together on regional and international projects.
Sanad and New York-listed Triumph group on Tuesday also signed a preliminary agreement to collaborate on providing next-generation engine maintenance, repair and overhaul (MRO) services for multiple engine types for aerospace and industry operations across the Middle East and Africa.
Mansoor Janahi, group chief executive of Sanad told The National on the sidelines of the event that the company has backlog contracts worth $7bn with various clients globally and expects more work this year as the travel industry recovers from the coronavirus pandemic.
“Overall signs are positive, once we see recovery, there is a pent-up demand and people want to travel. So we do believe this is going to flow into the business.”
In 2019, the company won a $6.5bn contract from Rolls-Royce to service engines powering Airbus A330 jets, tripling the volume of its annual maintenance work.
“We want to expand beyond aviation into new sectors and there will be new announcements soon," he said.
Along with Sanad and Strata, Mr Al Olama said he is also bullish about the growth of Mubadala unit Yahsat, and said five satellites operated by the company provide services to 80 per cent of the world’s population in Brazil, East Asia, Africa and parts of Europe.
Yahsat, which listed on the Abu Dhabi Securities Exchange last year, reported a 26 per cent jump in its first-quarter profit as revenue grew on the back of a strong performance of all its business segments.
Mubadala plays a key role in the Abu Dhabi government’s plans to diversify its revenue base and generate income from sources other than oil.
The company’s portfolio of investments spans five continents with interests in aerospace, information and communications technology, semiconductors, metals and mining, renewable energy, oil and gas, and petrochemicals.