Goldman Sachs Group Inc. is jockeying for a $10 billion mandate for its asset-management arm from Kuwait’s wealth fund, as part of the Wall Street bank’s efforts to bolster its private markets strategy and compete with larger players in the Middle East.
The firm has been in talks with the Kuwait Investment Authority to receive the money over the coming years and across multiple funds, according to people familiar with the matter. The capital is likely to be allocated largely toward Goldman’s private equity, credit and infrastructure funds, some of the people said.
Representatives for the KIA and Goldman declined to comment.
The arrangement has developed as part of Goldman’s push into the oil-rich Gulf nation, where the New York-headquartered investment bank opened an office earlier in October. Still, there’s no guarantee KIA will fulfill the entire investment.
Along with Chief Executive Officer David Solomon, the office opening was attended by Marc Nachmann, the global head of the firm’s asset and wealth division. Nachmann is trying in particular to grow private assets under supervision, which stand at $374 billion, according to Goldman’s third-quarter earnings.
Like other finance giants, the bank has been ramping up its presence in the Middle East with an eye on the region’s sovereign investors that control assets worth trillions of dollars, though it’s not always an easy sell.
While the potential investment is a footnote for KIA that has about $1 trillion in assets, the deal could be significant for Goldman, which faces stiff competition from larger private markets players like KKR & Co, Blackstone Inc. and Apollo Global Management Inc. in growing its footprint in the Middle East.
Other major investment firms such as Carlyle Group Inc., Franklin Templeton and State Street Corp. are also looking to set up offices in Kuwait, Bloomberg News has reported. That follows BlackRock Inc.’s decision to open up in the country and would be a boost to the city-state’s efforts to deepen its financial sector, which has lagged behind Dubai, Abu Dhabi and Riyadh.
Many of the firms already count Kuwait as a client, and a physical presence would allow them to further strengthen ties with the government and its wealth fund. Some of those relationships were on display recently, when Goldman helped manage Kuwait’s first international bond sale in eight years.
Goldman opened an Abu Dhabi office in 2023, and was the first bulge-bracket bank to get a regional headquarters license in Saudi Arabia. Finance chiefs from around the world are assembling in Riyadh this week, where Solomon is among executives scheduled to speak at a conference hosted by Saudi Arabia’s Public Investment Fund.
No comments:
Post a Comment