Mubadala Investment Company, Abu Dhabi’s strategic investment arm, is looking to expand its portfolio of investments in Asia and is doubling down on technology, its chief executive said.
After investing $1.2 billion (Dh4.4bn) in Jio Platforms, the digital business unit of India's Reliance Industries this month, Mubadala is exploring further opportunities in India, China and South-East Asia, Khaldoon Al Mubarak said at a Bloomberg event on Monday. The company is predominantly eyeing the technology sector, including medicine technology, life sciences, artificial intelligence and agriculture-technology.
“One of the things we have been very careful about in the last couple of years is expanding our horizons in Asia … finding the right opportunities there in the spaces that we like,” Mr Al Mubarak said.
There are “opportunities in Asia right now, and we are, I think from a relative perspective, under invested in Asia so you’ll see us grow our portfolio.”
The Jio Platforms deal in India is a good example of what sort of opportunities the company is exploring in Asia, Mr Al Mubarak said, adding that Jio is a "good bet on India" in a sector Mubadala expects to grow in the future.
The company will continue to invest in Europe and the US, despite valuations being high and the global economic slowdown, induced by the Covid-19 pandemic.
“If you look at the US market right now, in my view it does not reflect the reality of the macro situation that we see in the US and the rest of the world,” he said. “But, having said that, quality is quality … at the end of the day it is about quality and quality defies valuations.”
Mubadala has about 38 per cent of its portfolio in the US.
Despite economic headwinds, Mr Al Mubarak said Mubadala is looking to take prudent risks as the world learns more about Covid-19 and its impact on businesses and the economy. The approach of Mubadala’s investment committee from being "risk-averse" has also changed over the past weeks as it now has a better appreciation of what sort of risk the company can take in this environment.
“I’m pro-responsible risk ... responsible and prudent risk-taking,” he said. “We are being more progressive and in our approach, we are taking a four- to five-year view and we are taking investment decisions with new convictions, based on this Covid-era and the post Covid-era that we anticipate.”
The global economy is set to slide into the deepest recession since World War II and the World Bank expects global output to shrink by 5.2 per cent as a result of the pandemic.
In recent years, Mubadala has pivoted to investing in the technology sector with a focus on investments in the venture space, medtech, life sciences and AI. It will continue to be an area of focus, he added.
“We thought pre-Covid, that’s the place to go, that’s the arena for us to build experiences and expertise in and deploy significant capital,” Mr Al Mubarak said. “We started that journey pre-Covid, we are continuing it during Covid and most firmly you will see Mubadala, over the next five years … a far more sophisticated technology space investor.”
In March, the company joined a consortium that is investing $2.25bn in Waymo, the self-driving technology company owned by Google’s parent Alphabet. Earlier in the year, Mubadala invested €1bn (Dh4.17bn) in a French investment fund that will be managed by the country’s national investment bank, Bpifrance.
With an asset base of Dh853bn, Mubadala is at the heart of the Abu Dhabi’s plans to diversify the emirate's 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.
Earlier this month, Mubadala reported more than a four-fold increase in its 2019 comprehensive income to Dh53bn, from Dh12.5bn a year earlier. It monetised a number of mature assets in 2019, realising a total of Dh63bn in funds and made new capital investment of Dh68bn last year, it said at the time.