Lunate to set up $2bn joint investment platform with Brevan Howard at ADGM

Abu Dhabi-based company will also take a minority stake in global hedge fund manager as part of the deal

Lunate says the new investment platform will be domiciled at Abu Dhabi's financial hub ADGM. Photo: ADGM

Abu Dhabi-based global alternative investment management company Lunate and hedge fund manager Brevan Howard are setting up a $2 billion investment platform focused on macro and digital assets.

The platform, which will be based in Abu Dhabi’s financial hub ADGM, will also deploy capital through the existing investment strategies of Brevan Howard, which manages $34 billion in client assets globally, Lunate said on Tuesday.

Lunate is committing $2 billion in long-term financing for the investment platform. The new funding, exclusive to the partnership, is expected to be raised over time from local and international investors, the company said, without giving the timeframe for the same.

As part of the deal, Lunate will also acquire a minority stake in Brevan Howard, which will help the company with $110 billion assets under management to expand and diversify its range of products and investment solutions for clients in the Gulf region as well as in markets globally.

“Our new partnership with Brevan Howard marks our expansion into hedge funds and reflects our commitment to work with the best investment firms in the world, offering our clients access to unique strategies to further diversify their portfolios, said Khalifa Al Suwaidi, managing partner at Lunate.

Brevan Howard has grown over the past two decades, offering institutional investors access to its macro assets including currencies, bonds, equities and commodities – as well as trade structuring investment strategies. The company, whose investors include sovereign wealth funds, corporations, public pension platforms, foundations and endowments, established its regional headquarters at ADGM in early 2023. It is now the company’s largest office by assets managed globally.

“The long-term partnership with Lunate reflects our deep and ongoing commitment to the region and we look forward to building on this foundation over time,” Brevan Howard’s founder Alan Howard said.

Lunate in recent quarters has formed several funds and investment partnerships to expand its asset base and its suite of investment products for its clients.

In May, Lunate teamed up with New York Stock Exchange-listed Brookfield Asset Management to set up a $1 billion joint venture to invest in the real estate sector across the Middle East amid a property market boom.

The investment platform would focus on build-to-sell and “opportunistic” buy-to-sell residential assets across the UAE, Saudi Arabia and other markets in the Middle East, the two companies said at the time, adding that Lunate has committed a “significant cornerstone investment” to the joint venture.

The announcement followed Lunate’s acquisition of a 49 per cent stake in Dubai's 53-storey ICD Brookfield Place building last year. Saudi conglomerate Olayan Financing Company was also part of the deal.

In April, Abu Dhabi-based company acquired a 40 per cent stake in Adnoc Oil Pipelines (AOP) from BlackRock and KKR.

Our new partnership with Brevan Howard marks our expansion into hedge funds and reflects our commitment to work with the best investment firms in the world, offering our clients access to unique strategies to further diversify their portfolios

Khalifa Al Suwaidi,
Managing Partner, Lunate

The acquisition, made by one of Lunate's funds, was executed through the purchase of a 100 per cent stake in a special purpose vehicle jointly held by the two institutional investors' managed funds.

Adnoc Oil Pipelines was set up in 2019 to lease ownership interests in 22 pipelines from Adnoc for 23 years through a concession agreement. Lunate’s stake acquisition came nearly five years after BlackRock, the world’s largest asset manager, as well as global private equity firm KKR paid $4 billion upfront through a SPV to invest in Adnoc’s pipeline assets.

Lunate, which has interests in private equity, venture capital, private credit, real assets, public equities and public credit markets, also launched a fund in February that allows private companies nationwide to offer their employees investment returns on end-of-service benefits for the first time in the UAE.

The Ghaf Benefits scheme permits employers across the UAE to transfer employees' end-of-service gratuity to the fund to receive potential investment returns.