GE and Mubadala Development Co., headquartered in Abu Dhabi, UAE, announced on July 22 a partnership that will cover clean energy research and development as well as financial initiatives.
The companies will establish a clean energy technology center located in Masdar City, the new carbon neutral, zero-waste city in Abu Dhabi. Masdar is Mubadala's alternative energy initiative. 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.
"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," GE CEO Jeff Immelt said. "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's CEO, Khaldoon Al Mubara said, "GE constantly sets global benchmarks and is well positioned for continued success. When we partner, we seek to create value for both parties in multiple ways. This partnership does exactly that."
The companies will also establish a jointly owned global commercial financial services business headquartered in Abu Dhabi with origination, funding and risk management capabilities. The two companies will each allocate $4 billion in equity for the venture over a three-year period. The venture will expand GE's opportunity pipeline globally, particularly in the Middle East and Africa, while providing Mubadala with access to GE's commercial finance capabilities. The expectation is that Mubadala will become one of GE's top ten institutional investors.
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.
GE and Abu Dhabi Aircraft Technologies (ADAT), Mubadala's leading Middle Eastern aviation maintenance, repair and overhaul (MRO) company, will explore expansion of their MRO capabilities to support the large and growing number of GE aircraft engines in service in the region. GE will widen the scope of its joint venture with ADAT, called Gulf Turbine Services, to include field service and repair capability for the oil & gas industry in the UAE.
GE and Mubadala have been working together for four years and GE currently 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, helping create solutions in clean energy.