Abu Dhabi state fund Mubadala Investment Company has committed $1 billion to U.S.-based Blue Owl Capital’s credit platform under a strategic partnership announced by the two companies on Monday.
The investment will initially focus on providing financing for technology companies, Mubadala and Blue Owl said in a statement.
Blue Owl is an alternative investment manager with $150 billion in assets under management.
Mubadala is expanding its credit investment strategy into technology lending amid increasing demand for debt capital from well-established, high-growth software businesses, Mubadala’s head of credit investments Fabrizio Bocciardi said in the statement.
The Abu Dhabi sovereign investor has been investing in private debt opportunities through its credit investment unit since 2009, mostly in North America and Europe but has recently strengthened its exposure in the Asia Pacific.
Money managers are vying for a slice of the growing private credit market, which emerged in the aftermath of the 2008 financial crisis and is currently estimated to have assets of $1.5 trillion. Private credit funds are increasingly competing with banks, including for financing large company buyouts.
That has only intensified in the wake of Silicon Valley Bank’s failure, attracting the attention of sovereign wealth funds in the Gulf, including the $445 billion Qatar Investment Authority (QIA).
QIA has been very active in private and public credit over the past few years, CEO Mansoor Ebrahim Al-Mahmoud told an audience at a forum in May.
“So normally institutions like us, which are very liquid, very long term, have a risk appetite in these types of investment. I would advise that for the next maybe one year, the credit space would be an interesting space to deploy some investment,” al-Mahmoud said at the time.
Reuters