Invest AD quits direct investment

The Abu Dhabi sovereign fund, a regular investor in infrastructure, has run out of dry powder and given up raising a new buyout 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.

Invest AD has been a direct investor in various infrastructure projects, notably through its backing of the $320 million Muharraq wastewater treatment plant PPP in Bahrain in 2011. In 2009, the firm announced a partnership with Korea Development Bank and the Korea Trade Promotion Agency to increase investment in alternatives between their regions.

It also launched a $600 million infrastructure fund alongside UBS Global Asset Management the same year – an initiative that was ultimately aborted in 2010, a decision attributed by the firm to the weak investment climate.

All references to private equity and infrastructure 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 According to the firm’s website, Assaad has since been replaced by Serkan Kizil, a former M&A banker at Goldman Sachs and senior vice-president at the company.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.