Abu Dhabi Investment Company (ADIC), the U.A.E state owned group is considering an opportunistic acquiring of U.S. assets that are looking attractive in a troubled financial environment and the surging dollar, reports Reuters. Although, the oil rich Middle East region which has so far been impervious to the global credit crunch is cautious about investing in Europe and considers regulators could not be so active in that region as in the U.S.
The Reuters report quotes Nazem Al Kudsi, CEO, ADIC as saying “‘We think U.S. assets are getting very very attractive vis-a-vis other G7 assets”.
Interestingly, Kudsi pointed out the fact that during difficult times, the U.S. authorities makes efforts to come to the rescue of companies, and was not so sure if the European Central Bank (ECB) would be equally proactive in Europe, the region where problems are also starting.
‘The authorities in the U.S. are taking the toxic assets off balance sheets of banks and transferring them to the government and taxpayers, so we are left with the good stuff and you have to admit that the dollar has absorbed negative news in a short period very well,’ Kudsi added.
The U.S, is in a bottoming process and ADIC is particularly looking at U.S. commercial real estate and equities as opportunities for growth at the right pricing.
ADIC together with Abu Dhabi Investment Authority (ADIA) is the world’s largest sovereign wealth fund. Both are owned by state-run Abu Dhabi Investment Council. The sovereign wealth funds in the Middle East region have been oiling the bruises of the badly hit Western Banks for quite some time now. In November, ADIA sealed a deal to buy a $7.5 billion stake in U.S. bank giant Citigroup.
The biggest SWF’s are Abu Dhabi’s ADIA ($875bn), Norway’s Pension Fund ($380bn), Singapore’s GIC ($330bn), and Saudi Arabia’s various holdings which total $300bn. Wall Street multinationals like UBS, Morgan Stanley, Merrill Lynch and Citigroup received total cash injections of about $35 billion from these funds.