BlackRock invests in Mubadala Capital's private equity business

Consortium led by the world's largest asset manager has also committed $400m to Mubadala Capital’s private equity Fund III

Abu Dhabi-based Mubadala Capital has received a significant investment in its private equity business from a consortium led by BlackRock.

Mubadala Capital, the asset management subsidiary of Abu Dhabi’s sovereign fund Mubadala Investment Company, received a “significant” investment into its private equity business from a consortium led by the world's largest asset manager BlackRock.

BlackRock’s Secondaries and Liquidity Solutions (SLS) and a group of global institutional investors have invested in assets currently managed by Mubadala Capital, the company said on Wednesday.

The group of companies also committed $400 million to Mubadala Capital’s private equity Fund III, which has exceeded its fundraising target and closed at $1.6 billion.

“BlackRock’s institutional approach to underwriting and partnership-orientation has helped create what we expect to be a landmark transaction, especially in a highly uncertain market environment,” Adib Martin Mattar, head of private equity at Mubadala Capital, said.

The partnership between Mubadala Capital and BlackRock is in parallel to the $3bn final close for BlackRock’s $3bn SLS strategy in March.

BlackRock aims to invest in mid-sized secondary transactions and its team has developed “conviction around Mubadala Capital and the underlying portfolio", which it said "will be a key and core investment in its SLS strategy”, according to the statement.

“Completing this investment was highly collaborative between BlackRock, our partners and Mubadala Capital,” Veena Isaac, managing director of the BlackRock SLS, said.

“We look forward to being a limited partner and continuing to explore further ways to collaborate with Mubadala Capital in what is clearly a highly differentiated investment platform that has demonstrated an ability to leverage its sovereign access and network for the benefit of its investors.”

As well as managing its own investments, Mubadala Capital manages about $9bn in third-party managed funds across its private equity, public equities, venture capital and Brazil businesses.

In addition to successful exits from EMI Music Publishing and Restaurant Brands International, Mubadala Capital has a long track record of strategic investments, leveraging the secondary market to seek attractive returns for its investors.

Its parent, Mubadala, which has an asset base of Dh894bn ($243.4bn), invests on behalf of the Abu Dhabi government. The sovereign fund is driving the emirate’s efforts to diversify its revenue base and generate income from sources other than oil.