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Revision as of 13:11, 16 March 2008
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The Abu Dhabi Investment Authority (ADIA) is one of the government investment companies of Abu Dhabi, United Arab Emirates. It has been estimated that they have approximately $875 billion in assets.[1] It struck a deal on 11/26/07 with Citigroup, the largest US bank, by agreeing to invest 7.5 Billion dollars in Citigroup. This deal gives ADIC 4.9% of the New York based bank making it the largest shareholder, making Prince Alwaleed Bin Talal Al Saud of Kingdom Holding of Saudi Arabia the second-largest shareholder with 4.3%.
History
ADIA was established in 1976 by Sheikh Zayed bin Sultan Al Nahyan, the founder of the United Arab Emirates. The goal was to invest the Abu Dhabi government’s surpluses across various asset classes, with low risk. At the time it was novel for a government to invest its reserves in anything other than gold or short-term credit. Even today, investment in short-term paper remains the strategy for the vast majority of countries. [Euromoney [2] ] 2006: cited below].
Investments
ADIA manages a substantial amount of capital, and is one of the world's larger investment funds. Due to its size, the fund has been influential in international finance.
It manages the emirate’s excess oil reserves, estimated to be as much as $500 billion. [Euromoney 2006: cited below] Its portfolio grows at an annual rate of about 10% compounded. [Euromoney 2006: cited below] As such Adia is the world’s second biggest institutional investor, behind only the Bank of Japan, according to the Oxford Business Group
Today ADIA invests in all international markets – equities, fixed income, real estate, private equity and alternatives (hedge funds and commodity trading advisers – CTAs). ADIA's global portfolio is broken down into sub-funds covering a specific asset class. Each asset class has its own fund managers and in-house analysts covering it. Almost every asset class is managed both internally and externally. Overall between 70% and 80% of the organization’s assets are managed outside. [Euromoney 2006: cited below]
References
External links
- ADIA
- SWF Institute Profile on ADIA