RDIF teams up with Mubadala for $2bn fund

And with OJSC Russian Grids to attract foreign private investment into Russia's power sector.

The Russian Direct Investment Fund (RDIF) has been involved in a flurry of activity this week, announcing two new partnerships over the last two days alone.

 A 50/50 joint venture with Abu Dhabi-based investment company Mubadala, announced yesterday, will lead to a $2 billion co-investment fund targeting long-term investment opportunities in Russia.

Speaking on a conference call, Sean Glodek, a director at RDIF, explained the fund will not be “sector specific but will look at infrastructure. Of our $10 billion fund [RDIF], around a third is expected to go into infrastructure projects. We would expect this arrangement to be a similar percentage. But there are no set rules,” he explained.

In a separate announcement today, RDIF said it had signed a memorandum of understanding (MOU) with OJSC Russian Grids – Russia’s largest power supplier and distributor – to “attract investment into the Russia power grid sector, with a particular focus on foreign investments”. 

RDIF said the two partners plan “to make the case for investment in long-term infrastructure projects in the utilities industry and to explore funding mechanisms, including public-private partnerships, to support Russian Grids’ investment programme”. 

Earlier this week, RDIF and New York-listed General Electric (GE) also signed a MOU for the construction of mini power plants for manufacturing companies across Russia. Such systems are independent from the federal power grid and supply energy directly without the need to construct transmission lines, which reduces the risk of power cuts. 

With so much going on, then, when can we expect to hear about new infrastructure deals from RDIF? 

“It has been two years since launch and during 2011/12 we were putting the team together. Over the last 12 months we have deployed $700m in deals and attracted another $2 billion. We have a full pipeline of projects. Stay tuned for more announcements,” Glodek teases. 

*Andy Thomson contributed to this story.