A new dune

1 October 2015 By Una Galani Follow @ugalani

Emirati fund Mubadala has sold a $3.6 bln loan portfolio jointly held with GE. It may be driven by the U.S. conglomerate’s turn away from finance. But the decision by its Gulf partner to follow is a sign of how sovereign investors have lost their risk appetite.

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Apollo Global Management’s mid-market lending unit, MidCap Financial, said on Oct. 1 it would acquire $3.6 billion of loans managed by Mubadala GE Capital.

The deal, consisting primarily of corporate and real estate loans in the United States and Europe, represents most of the loan portfolio of Mubadala GE, which had total assets worth $4.6 billion at the end of June 2015.

Mubadala GE is a 50-50 joint venture created in 2009 between Mubadala Development, an Abu Dhabi sovereign wealth fund, and General Electric’s finance business called GE Capital.

In April, GE announced plans to sell off most of GE Capital.

“We believe that the high quality portfolio… will greatly accelerate our direct origination efforts in the middle market,” said Howard Widra, partner of Apollo Global Management’s credit business, which manages MidCap Financial.

Perella Weinberg Partners advised MidCap on the acquisition. Mubadala GE was advised by Citigroup.

The all-cash deal is expected to close in the fourth quarter.

Context News

Apollo Global Management’s mid-market lending unit, MidCap Financial, said on Oct. 1 it would acquire $3.6 billion of loans managed by Mubadala GE Capital.

Mubadala GE is a 50-50 joint venture created in 2009 between Mubadala Development, an Abu Dhabi sovereign wealth fund, and General Electric’s finance business called GE Capital.

In April, GE announced plans to sell off most of GE Capital.

Perella Weinberg Partners advised MidCap on the acquisition. Mubadala GE was advised by Citigroup.

The all-cash deal is expected to close in the fourth quarter.

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