A $7.5 billion investment in Citigroup just before its
share price collapsed, was a noteworthy misstep in an
otherwise premium, but little-known portfolio. This deal
gave ADIA 4.9% of the New York–based bank, making
it the second largest shareholder, with Prince Alwaleed
bin Talal Al Saud of Kingdom Holding of Saudi Arabia
the third largest shareholder, with 4.3%.
Traditionally secretive, the Authority has recently
capitulated to pressure and made an effort to appear
more transparent. The global ADIA portfolio includes
investments in over 24 asset classes and sub-categories,
which have seen it generate a 6.5% return on an annual
basis over a 20 year period and an 8% return over 30
years.
46% of the ADIA portfolio in 2009 was allocated to
equities globally. 10% was invested in Government
bonds. Hedge funds account for a minimum of 5%,
whereas private equity stands at a 2% minimum.
Overall, 60-85% of the fund’s portfolio is invested in the
West, whereas emerging markets constitute 15%. We
remain in the dark regarding the fund’s balance sheet
and details of its total assets under management.
Other Investment Arms
ADIA is not the only Sovereign Wealth Fund in
Abu Dhabi. Two other investment companies – IPIC
(International Petroleum Investment Company) and
Mubadala - are getting more attention daily. With
holdings estimated to be in the trillions, “Abu Dhabi
Inc.” outranks the world’s largest listed companies,
which, in the current era of borderless corporatocracy, is
certainly significant.
Given that the Emirate of Abu Dhabi is governed by
a family, the distinction between family and national
investments is not always apparent. Chief Executive of
IPIC, Sheikh Mansour, recently purchased Manchester
City Football Club in a torrent of publicity, which
brought Abu Dhabi more prominently into Western
consciousness. Given the conservative nature of the
Emirate, the question of whether such a high profile
display was considered a positive move within governing
circles is open to speculation.
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