The Abu Dhabi Investment Authority is giving itself more room to invest in private markets after a record year of dealmaking for its buyout division during the pandemic.
The emirate’s biggest sovereign wealth fund, which oversees assets estimated at $686 billion, has raised its target allocation range for private equity and infrastructure, according to its 2020 annual review released on Wednesday.
The fund’s private equity department committed more capital than ever before last year with 24 investments, up from 18 in 2019. Direct investments and co-investments represented 55% of its overall deployment for 2020, up from 45% in 2019, with the balance committed to funds.
“ADIA’s investments in private equity and infrastructure have grown over a number of years and this has led to increases in the allocation bands for both asset classes,” said the fund’s managing director, Hamed bin Zayed Al Nahyan.
The promise of higher returns at a time of extra low interest rates is prompting the $10 trillion wealth fund industry to shift more capital into private markets that tend to be less liquid but offer steady cash flows for decades.
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