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Interview: Mubadala COO

Interview: Mubadala COO

Waleed Al Mokarrab Al Muhairi, chief operating officer for Abu Dhabi investment vehicle Mubadala, talks semi-conductors, aerospace, and regional unrest.

March 17, 2011 5:13 by

How did 2010 pan out for Mubadala?
Well, I think you know if you look globally 2009 and 2010 were years of high volatility. They were difficult years, but I’m proud to say the way that Mubadala acquitted itself, both from an asset manager perspective and from an allocation perspective. I think one of the big lessons that came out in the past two years was a reallocation of our portfolio and an understanding that the previous growth engines of the past are giving way to new growth engines. So you know we are really quite an emerging markets-focused, in Asia in particular, and we are trying to develop relationships in South and Latin America. So, I would say over the next three to five years, you’re going to see increased allocation in that part of the world.

And which sectors will you focus on?
Mubadala is primarily active in several sectors. There is aerospace, semi –conductors, renewable energy, infrastructure, healthcare, and energy. I would say we’re looking in expanding into businesses across all those different sectors, in some of those new target geographies.

What are the top three destinations in the future?
Mubadala is quite a diversified company both geographically and from an asset perspective. Some of the more exiting areas that we’re looking at are: activities in semi-conductors, which is truly a global business; aerospace is also exciting as we’re increasing our manufacturing capabilities. And you’ll see a little bit of activity, both in Asia and in Europe as well. We are also thinking about investing in the US, in the technological sector and other areas as well.

How do you think 2011 will end?
If we knew the answer to that, then we’re going to be very wealthy men. I think we’re expecting a little bit of volatility, but we do think that the worse is behind us. So you know we’re going to keep our ears on the ground and we’re always looking for opportunities. We do have liquidity and when we find great deals that fit our mandate, I think you’ll see some deployments of capital.

How is the economic situation in the UAE?
We’re riding out some of the economic volatility you had seen in the past. I think different sectors have been affected differently, but I think overall everybody is reasonably positive. We just need to go back to fundamentals. We need to make sure that we’re investing in infrastructure, which we are doing, and in some of the basic industrial businesses. We are ready for growth again.

What is the reason for your exit from Ferrari?
Well, the way the structure for the transaction is that Fiat, which is the largest shareholder for Ferrari, always had a call option on our stake. So after it had sufficiently appreciated over time – remember we have been shareholders for several years – they then exercised that contractual right and that is what happened.

Are you worried about the political situation in the Middle East?
I’m not a political commentator, but as an investor our perspective always is stability, regulation, and transparency – they are always conducive to investment.

Does that mean that North Africa for the moment is off your radar?
It’s that whenever you see events like you’re seeing today, you have to wait and see. You always have to look and you have to see what happens. You have to see what emerges. Nothing more, nothing less.

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