KKR acquires minority stake in Adnoc gas pipeline assets

Deal will boost New York-based private equity firm's Abu Dhabi infrastructure investments

The pipeline ownership and operational management will remain with Adnoc, KKR said. Photo: Adnoc

Global private equity firm KKR has acquired a minority stake in Adnoc gas pipeline assets, boosting its presence in the Middle East.

The value of the deal and size of the stake was not disclosed.

KKR is acquiring a minority stake through its managed accounts, matching the type and tenure of the investment with long-duration capital, it said on Wednesday.

The gas pipeline network connects Adnoc’s upstream assets to offtakers in the UAE. Ownership and operational management will remain with Adnoc, the company said.

The move will help KKR “invest further in Abu Dhabi’s long-term prosperity and critical infrastructure”, said David Petraeus, chairman of KKR Middle East.

KKR appointed David Petraeus, a former CIA director and one-time commander of US Central Command, as chairman of its Middle East franchise this year. AP

“This investment reflects KKR’s commitment to expand partnerships and investment across the Middle East," said Mr Petraeus, who is also the chairman of the KKR Global Institute.

KKR, which has operated in the Middle East for more than 15 years, has been expanding its footprint in the region. It appointed Mr Petraeus, a former CIA director and one-time commander of US Central Command, to lead Middle East operations in April.

The latest deal comes after KKR, along with the world’s largest asset manager, BlackRock, invested $4 billion in Adnoc’s pipeline infrastructure in February 2019, acquiring a 40 per cent stake. Last year, the stake was acquired by Abu Dhabi-based global alternative investment management company Lunate.

KKR also took a stake in one of the region’s largest data centre firms, Gulf Data Hub, this year, to jointly invest more than $5 billion to boost the Dubai company’s data centre infrastructure in the Gulf.

In July, Abu Dhabi's sovereign wealth fund Mubadala Investment Company and funds managed by KKR also jointly acquired Canada-based CoolIT Systems.

KKR, which had total assets under management of $686 billion at the end of the second quarter, said the latest deal will add to its $90 billion infrastructure portfolio.

“This strategic partnership leverages KKR’s expertise in infrastructure investments and Adnoc’s operational excellence to deliver practical energy solutions,” said Cristina Gonzalez, KKR’s managing director for infrastructure.

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The move comes as other private equity firms have also been expanding in the region. Buyout firms are keen to build teams on the ground, invest in local businesses and help develop the region’s asset managers.

In February, London-based private equity firm Permira said it planned to open an office in Dubai this year to expand its footprint in the Middle East.

Last December, US-based private equity company General Atlantic said it was opening a new office in Abu Dhabi, its second in the Middle East after Riyadh, as it aims to build on its $1 billion of investments in the region.

A private equity revival is starting to take shape globally following a rebound in deal-making in 2024, according to Bain & Company’s Global Private Equity report released in March. Investments and exits were up 37 per cent and 34 per cent, respectively, last year, it said.

However, deal activity has been complicated globally due to uncertainty stemming from US President Donald Trump’s trade tariffs.