Invest AD quits direct investment

The Abu Dhabi sovereign fund, which saw its head of buyouts depart at the end of last year, has run out of dry powder and given up raising a new vehicle.

Invest AD, the financial services company owned by the Abu Dhabi government, is to withdraw from direct private equity investing, according to several sources familiar to the matter. 

It is understood that the firm, which last raised a fund in 2009, has no more capital to deploy from its buyout vehicles. After failing to raise a successor vehicle in 2011, the firm no longer has any plans to raise dedicated private equity funds, sources said. Its previous vehicle was the $200 million Private Equity Partners II, which reached a final close in 2009.

All references to private equity have now been removed from the front page of Invest AD’s website, which no longer makes any mention of its Private Equity Partners suite of funds. 

Invest AD declined to comment. 

The news comes less than a year after the departure of Samir Assaad, who served as Invest AD’s buyout head for more than four years. According to the firm’s website, Assaad has since been replaced by Serkan Kizil, a former M&A banker at Goldman Sachs and senior vice-president at the company.  

Established in 1977, Invest AD was the sovereign wealth fund of the Abu Dhabi government until 2007, when it was known Abu Dhabi Investment Company. From then on, the company was given a new mandate to attract and manage third-party funds and rechristened to Invest AD in 2009. It is now a subsidiary of Abu Dhabi Investment Council

Its exposure to private equity has traditionally come via both direct investments and commitments to third-party vehicles. Although its buyout funds have exclusively focused on the Middle East and Africa, the firm has pledged capital to more than 50 funds active globally, with a focus on Europe, North Africa and Asia. It is a repeat investor in funds managed by TPG, The Carlyle Group, Kohlberg Kravis Roberts, CVC Capital Partners, Cinven, Coller Capital, The Blackstone Group, Advent International, Permira, Thomas H Lee Partners and Apollo Global Management, according to Private Equity International‘s Research and Analytics division.

In recent years, Invest AD has also sought to source buyout deals by teaming up with other managers: the firm announced a $100 million partnership with Japan’s SBI Holdings to invest in Turkish buyouts in May 2011, and followed that with the launch of another $100 million, MENA-focused joint venture with Washington DC-based Paladin Capital in May 2012. Invest AD would not confirm whether these ventures had so far completed any transactions.