Mubadala and IPIC merger draws closer

Two of Abu Dhabi’s largest sovereign wealth funds, Mubadala Development and International Petroleum Investment Company (IPIC), are close to finalising their merger. They will combine to form Mubadala Investment Company, which will hold about USD 125 billion in assets.

The merged entity will help Abu Dhabi control its spending by combining funds with similar assets, and is likely to be one of many mergers in the emirate. The merger will create efficiencies, find new cost saving opportunities and allow for more aggressive pursuit of growth.

While IPIC’s holdings are primarily focused on oil and gas, Mubadala Development’s holdings are more diverse. The newly formed company will combine production assets from Mubadala Development and refining and distribution assets from IPIC.

Bloomberg cited people familiar with the matter in January saying that Mubadala Development is considering investing USD 10 billion-15 billion in a partnership with SoftBank Group and Saudi Arabia’s Public Investment Fund to create a vehicle for investment in global technology.