Mubadala Investment Company, Abu Dhabi’s strategic investment arm, said its comprehensive income last year soared 36 per cent, driven by equity and fund investments as well as growth of assets across various sectors.
Comprehensive income jumped to a record Dh72 billion ($19.6bn) in 2020 from Dh53bn a year earlier, the company's largest profit in its history, Mubadala said in its annual review released on Thursday.
“We navigated our portfolio through the dramatic macroeconomic decline of early 2020 and decided to accelerate the pace of our capital deployment, ending the year with record profit and growth," Khaldoon Al Mubarak, Mubadala’s group chief executive and managing director, said.
"In line with our long-term strategy, we increased our investments in sectors where we have high conviction, and with high-performing fund managers. Technology and life sciences, in particular, have been essential to the world over the last year, and we see those sectors bringing greater opportunity for deeper investment," he added.
"We have worked to be well-positioned in these areas and in key geographies as the global economy continues to recover.”
Assets under management increased 5 per cent to Dh894bn at the end of last year from Dh853bn in 2019, with the UAE and the US accounting for the largest geographic areas of the company's portfolio. In addition to its new capital deployment in India, Mubadala also invested through its sovereign investment partnerships in France, China and Russia in 2020.
About 34 per cent of Mubadala’s portfolio is comprised of direct and indirect investments in private equity, with 29 per cent in public markets and 14 per cent in real estate and infrastructure among others, it said.
The sovereign wealth fund said new capital investment climbed to Dh108bn from Dh68bn in 2019. That includes Dh4.3bn in Reliance Industries’ Jio Platforms, India's biggest telecom network.
Other investments include Dh2.7bn in Silver Lake, a global private-equity investor, Dh3bn in Reliance Retail, India’s largest retailer, Dh2.2bn in PCI Pharma, a leading global pharma services supplier and Dh7.5bn through partnerships with CVC, Citadel, iSquared Capital and Apax Partners.
In 2020, Mubadala realised Dh104bn in revenue from mature assets and distributions from investments locally and abroad, including Dh16.7bn through the sale of a 39 per cent stake in Borealis to OMV, its largest-ever single monetisation.
"This strong performance was a reflection of our agility as an investor, as well as our globally diversified portfolio of equities, funds, and mature and growing companies," said Carlos Obeid, Mubadala’s group chief financial officer. "In 2020, we took advantage of the historically low interest rates to lower our cost of borrowing and extend its weighted average life on the back of strong investor demand for our bond issuances."
Mubadala is at the heart of the government’s plans to diversify Abu Dhabi'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.
In the UAE, the company has stakes in Emirates Global Aluminium, green-energy company Masdar, aerospace manufacturing company Strata, satellite communications company Yahsat and Mubadala Petroleum.
Mubadala is an anchor investor in SoftBank’s Vision Fund. The fund has pledged to invest £800 million ($1.01bn) in Britain’s life sciences industry over the next five years, as part of a £1bn Sovereign Investment Partnership between the UAE and UK. The remaining £200m will come from the UK’s Life Sciences Investment Programme.
Mubadala was already an investor in technology, artificial intelligence and agriculture technology, but the Covid-19 pandemic accelerated its pivot to that sector to capitalise on emerging innovations that are shaping clean energy, life sciences, mobility, automation, robotics and connectivity.
Mr Al Mubarak has said the firm is considering further opportunities in India, China and other South-East Asian markets.
Earlier this year, Mubadala changed its organisational structure to four lines of business – UAE investments, disruptive investments, direct investments and real estate and infrastructure – and said the new operating model will propel the company into the next phase of growth.