- General
- September 30, 2020
- 5 minutes read
Mubadala Buys Into Silver Lake
Khaldoon Al Mubarak, Chief Executive Officer, Mubadala Investment Company. Photo credit: Georgina Coupe/Number 10, licensed under Creative Commons Mubadala, a…
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| Khaldoon Al Mubarak, Chief Executive Officer, Mubadala Investment Company.
Photo credit: Georgina Coupe/Number 10, licensed under Creative Commons
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Mubadala, a sovereign wealth fund of the government of the United Arab Emirates (UAE), has reached a deal to acquire a minority equity interest in Silver Lake, a well-known tech-focused investment firm, and also pony up $2 billion for the private equity firm to manage, a deal marks a tie-up and the establishment of a long-term investment strategy between both investment firms. Mubadala is purchasing a minority equity stake in Silver Lake from a current shareholder, Dyal Capital Partners, which is itself a division of asset management giant Neuberger Berman. Neuberger Berman acquired an equity interest in Silver Lake in 2016 and will now sell roughly half of the stake it acquired to Mubadala. Exact financial terms of the deal aren’t disclosed.
Silver Lake is one of the world’s biggest investment firms, currently with over $60 billion of assets under management. The firm, which majorly invests in technology companies, is known for successful bets on companies including GoodRx, Credit Karma, Peloton, Unity, and Dell Technologies. Every year, Silver Lake deploys billions of dollars of capital into technology companies, with recent examples being bets on GoodRx, Byju’s, and Klarna. Similarly, Mubadala is a major investment firm but with much more capital ($200 billion+ AUM) than Silver Lake. Mubadala is more like a fund of funds, with global bets across across a variety of sectors including private equity funds, hedge funds, publicly-traded companies, and sports franchises. One of the sovereign wealth fund’s best-known assets is the Manchester City English football club.
Mubadala made its first bet in the technology sector by backing chip company AMD in 2007, and has since that time made more bets across the industry. Being one of the world’s biggest and well-known investment funds, a bet on Silver Lake likely serves as a confidence signal to the tech-focused investment firm’s business. Under the terms of their partnership, Mubadala and Silver Lake have crafted a 25-year-long capital deployment and return lifecycle. Before now, both firms weren’t exactly new to each other, having both crossed paths on several investments such as Waymo, Alphabet’s self-driving arm, and entertainment giant Endeavor.
“We are extremely pleased to deepen our partnership with the visionary team at Mubadala, firmly rooted in our orientation as a long-term investor in the most iconic and enduring businesses,” Silver Lake’s Co-CEOs, Egon Durban and Greg Mondre, penned in a press statement.
