GE (NYSE: GE) and Mubadala Development Company, headquartered in Abu Dhabi, UAE, today announced a framework agreement on a global partnership encompassing a broad range of initiatives including commercial finance and clean energy research and development. The agreement provides for shared capital commitments to new joint ventures and investment funds.
In addition, Mubadala also plans over time to become a long-term GE shareholder. The expectation is that Mubadala will become one of GE’s top ten institutional investors through the open market, as conditions allow.
The multi-faceted partnership will include initiatives in clean energy and water R&D. GE and Mubadala plan to establish a clean
energy technology center located in Masdar City, the new carbon
neutral, zero-waste city in Abu Dhabi. The center will be an
extension of GE’s global research network and will house up to 100
technologists developing new sustainable energy, water and other
environmental technologies. GE also will establish an ecomagination® center in
the Masdar facility to market and showcase its ecomagination products.
GE also intends to commit up to $50
million to Masdar’s second Clean-Tech Fund, focused on multi-geography
investments in the clean technology sector and companies that
simultaneously reduce dependency on traditional energy sources and the
environmental burden of energy production. In addition, Mubadala
intends to invest up to $200 million to GE Industrial Investment
Partners, a new partnership of select global investors that will focus
on providing growth capital to companies in the healthcare, energy, and
transportation industries.
The companies also intend to pursue joint ventures in aviation, oil and gas, and corporate learning.
GE Chairman of the Board and CEO Jeff Immelt said, "This partnership is consistent with our global growth initiatives and builds on our long-term relationships in a high-growth region like the Middle East. We can use our unique financial and industrial capabilities to establish profitable relationships across a number of businesses and we welcome them as a long-term shareholder."
Mubadala CEO and Managing Director Khaldoon Al Mubarak said, "Our long-term partnership with GE draws on a joint commitment to, and core expertise in, high-growth businesses like clean energy, project finance and aviation. Most importantly, both our companies regard knowledge and the development of executive and scientific talent as a competitive advantage."
GE and Mubadala have been working together for more than four years. Mubadala and GE jointly manage an infrastructure fund (The Mubadala Infrastructure Partners) that invests in major projects in the region. GE also is an anchor partner in the Masdar initiative. GE has also hosted Mubadala senior executives at its Crotonville leadership center in New York. This in turn led to the Mubadala & GE Management Program that was launched in Abu Dhabi in 2006–a leadership program run in Abu Dhabi and across the Arabian Gulf.
GE has been growing significantly in the Middle East, including Abu Dhabi. GE’s 2007 revenues in the region were over $5 billion, an increase of 50% over 2006. Abu Dhabi companies and institutions represent a large customer base for GE’s aircraft engines, healthcare and energy products and services. GE has established Abu Dhabi as an important GE service center hub in the region, with facilities dedicated to its Energy and Sensing businesses.
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