Abu Dhabi Investment Council: Structure, Investments, and Purpose

This assignment analyzes the Abu Dhabi Investment Council (ADIC), an investment arm of the Abu Dhabi government and a sovereign wealth fund of the UAE. It details ADIC's investment strategies, which include a diversified portfolio across real estate, private equity, infrastructure, and various financial markets globally. The document explains the council's purpose: to invest government surplus funds, diversify risk, and facilitate the economic development of Abu Dhabi. It also covers the restructuring of ADIC as part of the Mubadala Investment Company Group, enhancing its investment scale and competitive position. The analysis references Bloomberg, Gulf News UAE, and ADIC publications to support the information provided, offering insights into the council's operations and strategic objectives.

[ Abu Dhabi Investment Council

ADIC
Answer to 1
Abu Dhabi Investment Council or the ADIC is an investment arm of Abu Dhabi government.
It is primarily a sovereign wealth fund that is owned by the UAE (United Arab Emirates).
Further, it is liable for investing the surplus funds of the government through an
internationally diversified investment strategy. It intends to target positive capital returns with
the help of an expansive portfolio of active investment management strategies and highly
widespread class assets (Bloomberg, 2018). The council is also entrusted with the power to
mandate the direct investment to widen the economic base of Abu Dhabi and facilitate the
global development of domestic companies. The council initiated its operations from April
2007 and intends on becoming an efficient institution of managing assets and creating returns
as well.
Answer to 2
ADIC invests in real estates, private equity, infrastructure, public equity, hedge funds, and
fixed income markets throughout the world. For the purpose of its public equity investments,
the council intends to invest in small cap and large-cap companies. Moreover, the council’s
fixed income investment is primarily diversified credit and emerging debt securities that are
associated with sovereign and international inflation (Gulf news UAE, 2018). Besides, the
council’s investment of hedge funds comprises of investment in funds that further invests
across hedge equity strategies, relative value strategies, event-driven strategies, macro
strategies, and systematic CTA. For private equity investments, ADIC makes secondary,
direct, and fund of fund investments in private markets and both listed and unlisted
companies throughout the world. Its other investments include infrastructure and real estates
as well.
Answer to 3
Abu Dhabi needed a new vehicle to invest few of its oil receipts in order to compete with
Abu Dhabi Investment Authority that was regarded as government’s longstanding arm of
investment and largest Arab institutional investor. Since the risk of government was getting
higher day-by-day, ADIC was formed with a purpose of setting up a balanced portfolio of
investments throughout all classes and sectors of assets, thereby diversifying the
government’s risk. Nonetheless, the council was formed to differentiate itself from ADIA
with a particular focus on investments within the Middle East together with facilitating
international investments (ADIC, 2018). Hence, this was the major purpose behind the
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ADIC
formation of Abu Dhabi Investment Council but this does not mean replacement of ADIA as
a whole.
Answer to 4
The structure of Abu Dhabi Investment Council is just like a sovereign wealth fund institute
that was formed with the purpose of investing the government’s fund all across the globe.
However, the managing director of the council facilitated in restructuring the council by
making it part of the Mubadala Investment Company Group. With such restructuring process,
a world-class investment scale of investments can be established, thereby enhancing the
attempts of Abu Dhabi in generating more revenues and enhancing its competitive position as
a whole (ADIC, 2018). Under such new law, the directors of Mubadala Investment Company
Group will become the Board of directors of the council that will continue to operate like it
was before but only on a grand scale.
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References
ADIC. (2018). Abu Dhabi Investment Council (ADIC). Retrieved from
https://www.abudhabi.ae/portal/public/en/departments/adic;jsessionid=4aphdfofM
ouWL51GP6-Hre8Pf_cqK5cnNyvBCar8x3jJVX97qBTs!455785616!-380889922!
1522053544479
Bloomberg. (2018). Company Overview of Abu Dhabi Investment Council. Retrieved from
https://www.bloomberg.com/research/stocks/private/snapshot.asp?
privcapId=53306153
Gulf news UAE. (2018). UAE President orders restructuring of Abu Dhabi Investment
Council. Retrieved from http://gulfnews.com/news/uae/uae-president-orders-
restructuring-of-abu-dhabi-investment-council-1.2192170
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