ABCD Macquarie invests $188 million in Abu Dhabi

Feb 2, 2009

ABCD Macquarie makes its first investments in Abu Dhabi infrastructure from a newly raised $630 million fund.

The ABCD Macquarie Infrastructure Fund (AMIF) has announced a $188 million first investment in projects commissioned by Abu Dhabi economic zone developer ZonesCorp.

AMIF's investment with ZonesCorp will give the fund exposure to a number of the developer's medium and light industrial zones. Those zones include the existing Al Ain Industrial City and the second phase of the Industrial City of Abu Dhabi (ICADII) which is under construction. The phase will add 10 square kilometres to the current 11 by October.

"This investment gives AMIF exposure to ZonesCorp-commissioned projects that form part of its charter to develop the industrial infrastructure of the emirate of Abu Dhabi and create a business climate conducive to growth and economic diversification," says ADCB Macquarie managing director Hajir Naghdy.

The fund's investment in Abu Dhabi industrial infrastructure come little more than a month after AMIF raised $630 million in its first fundraising exercise. The fund provides equity capital for the full spectrum of infrastructure projects, including roads, utilities, water and energy transmission and distribution, in the Gulf Cooperation Council and Mena (Middle East North Africa) region.

AMIF hopes to raise a total of $1 billion to fund infrastructure projects.

The United Arab Emirates (UAE) posted strong industrial investment growth in 2008. The country attracted Dh77 billion ($21 billion) in new industrial investment for the year, up 7% and topping 2007's growth of 3%.

ZonesCorp reports that ICAD phase one is already 60% full, attracting a Dh11 billion return on the authority's initial Dh450 million investment. ZonesCorp is the Abu Dhabi government's economic development zone authority.

The UAE government is diversifying the country's economy and has an ambitious goal of attracting Dh120 billion in industrial development annually by 2012.

In addition to attracting money from private funds such as AMIF, the UAE and individual Emirate governments plan to increase infrastructure spending this year. The national government's 2009 budget includes a 24% increase in infrastructure spending and Dubai's budget includes a 42% increase. Abu Dhabi has yet to announce final budget numbers but is expected to increase infrastructure spending by 33%, according to Citi.

AMIF was launched in December 2008 by ABCD Macquarie as part of the bank's ongoing focus on infrastructure investment in the Mena region.