UAE President Mohamed bin Zayed Al Nahyan is currently on a state visit to South Korea, where he is set to engage in high-level discussions with representatives from major private equity fund (PEF) management companies. This visit underscores the UAE’s strategic interest in South Korea’s burgeoning private equity market and its key industries.
During his visit, President Mohamed will meet with Han Sang-won, CEO of Hahn & Company, Lee Hae-jun, CEO of IMM Private Equity, and Chae Jin-ho, CEO of STIC Investments. These meetings, requested by the UAE side, highlight the importance the UAE places on fostering financial ties with South Korea. The UAE’s sovereign wealth funds, which collectively manage assets worth approximately $1.459 trillion, are significant limited partners (LPs) in the South Korean PE market, which grew to 136 trillion won last year.
The UAE operates three major sovereign wealth funds: Abu Dhabi Investment Authority (ADIA), Mubadala, and ADQ. As of last year, these funds managed assets totaling $1.459 trillion, with ADIA alone managing $984 billion, making it the fourth-largest sovereign wealth fund globally. According to Global SWF, these funds were among the top 10 most active dealmakers last year, reflecting their aggressive investment strategies.
In the afternoon of May 28, President Mohamed is scheduled to meet with the CEOs of Hahn & Company, IMM PE, and STIC Investments. An industry insider noted, “These executives are pivotal in managing funds that attract global LPs, including those from the UAE.” These meetings are crucial as they involve key figures responsible for fund management and global fundraising.
STIC Investments has demonstrated the lucrative potential of the Korean market, achieving a 134% internal rate of return (IRR) from its investment in HYBE, a major player in the Korean entertainment sector. This success story is likely to be a point of interest for the UAE, which is keen on diversifying its investment portfolio beyond traditional sectors like oil and gas.
ADIA, the largest of the UAE’s sovereign wealth funds, plans to invest over 1 trillion won in single funds, indicating a strong focus on large-scale investments. Hahn & Company, IMM PE, and STIC Investments manage funds worth trillions of won, with Hahn & Company leading the industry with a total committed capital of 13.6053 trillion won as of last year, followed by IMM PE with 6.4709 trillion won, and STIC Investments with 6.2558 trillion won.
The UAE’s interest extends beyond private equity to include South Korea’s secondary battery and semiconductor industries, sectors that are crucial for the future of technology and energy. ADIA’s significant interest in these industries aligns with its broader investment strategy aimed at diversification and sustainable growth.
In addition to meetings with PEF representatives, President Mohamed will also engage with venture capital (VC) leaders, including Lee Jun-pyo of SBVA and Moon Sung-wook of Signite Partners. This indicates a comprehensive approach to exploring investment opportunities across various stages of business development.
The UAE’s sovereign wealth funds have a history of active engagement in global markets. Global SWF reported, “At the end of last year, the combined assets under management (AUM) of these three funds reached $1.459 trillion.” Their involvement in South Korea’s private equity and venture capital markets is expected to foster a virtuous cycle of growth, benefiting both nations.
As the UAE continues to diversify its investment portfolio, its collaboration with South Korea’s financial and industrial sectors is poised to strengthen. The outcomes of President Mohamed’s visit and the subsequent investments could significantly impact the economic landscapes of both countries, paving the way for future cooperation and mutual growth.