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Macquarie to co-manage Abu Dhabi infrastructure fund

A government agency of Abu Dhabi has established an infrastructure fund, which Macquarie Bank and Abu Dhabi Commercial Bank will co-manage and provide 25 percent equity.

Macquarie Bank and Abu Dhabi Commercial Bank (ADCB) are to co-manage and provide 25 percent equity in a 1 billion United Arab Emirates dirham ($272 million; €219 million) infrastructure fund.

The new vehicle, ZonesCorp Infrastructure Fund, has been established by a government agency of Abu Dhabi and, according to Chairman of ZonesCorp and Department of Planning and Economy Sheikh Hamed Bin Zayed Al Nahyan, is the first infrastructure fund in the Abu Dhabi emirate.

Last year, ADCB Macquarie Corp Finance, a joint venture in which Macquarie holds 49% and ADCB the remaining stake, was formed to build on the corporate finance capabilities of both banks, particularly in the infrastructure sector. ADCB is 65 percent owned by the government of Abu Dhabi, through Abu Dhabi Investment Authority.

Wholly-owned by the Department of Planning and Economy, ZonesCorp is a government agency established in 2004 to promote investment in Abu Dhabi.  ZonesCorp will provide 75 percent of the equity in the 10-year closed-end fund that will invest in ZonesCorp-commissioned infrastructure projects in industrial and commercial zones.

“There is a strong pipeline of potential assets identified, including the Industrial City of Abu Dhabi (ICAD) Phase II and the Industrial City of Al Ain,” ZonesCorp CEO Norm Johnston said in a statement. “These and other potential projects are currently undergoing due diligence, the results of which will establish their appropriateness for investment by the ZonesCorp Fund.”

Macquarie’s executive director Stephen Mentzines said in the statement that Macquarie currently manages 24 infrastructure and specialised funds globally.  The funds hold investments in 95 assets with total equity under management of US$24 billion, he added.