Aldar Properties and Apollo Global Management, one of the world’s largest alternative investment managers, have signed a historic commitment that will see funds and clients managed by Apollo invest a total of $1.4 billion in strategic capital to drive Aldar’s transformational growth initiatives.
The commitments are structured according to the following components:
*$500 million: investment in land joint venture
*$500 million: subordinated perpetual bonds issued by Aldar Investment Properties
* $300 million: Mandatory convertible preferred stock investment in Aldar Investment Properties
*$100 million: Common stock investment in Aldar Investment Properties
According to Aldar, the $500 million land joint venture will allow the developer to realize long-term value from its extensive land pipeline, while retaining the flexibility to develop or sell the land in accordance with its long-term development strategy.
As part of the deal, Apollo will take a direct minority stake in Aldar Investment Properties at its net asset value, underscoring the underlying strength of its asset base and Apollo’s belief in the company’s growth strategy. , its management capabilities and its ability to capitalize on accretive opportunities. that await us.
Aldar Investment Properties is rated Baa1 by Moody’s, the highest credit rating for a non-governmental company in the region.
This investment, for both Aldar Investment Properties and Aldar Group, demonstrates the company’s ability to attract institutional capital into its real estate platforms.
It also demonstrates Aldar and Apollo’s ability to execute innovative and diversified capital solutions, as evidenced by Aldar’s first-ever perpetual subordinated bond issuance and the largest hybrid private placement in the MENA region with the longer no-call period.
Commenting on the deal, Group CEO Talal Al Dhiyebi said: “This historic transaction is a signal to the global investment community that the Abu Dhabi property market is on a growth trajectory, supported by strong ‘significant economic and social reforms, and a world-leading response to Covid. -19.’
“Aldar’s ability to attract a long-term partner such as Apollo underscores the strength of Aldar’s commercial franchise, as well as the quality and investment appeal of the Abu Dhabi property market, both of which are driven by strong fundamentals that underpin long-term economic growth,” he said.
The transaction follows successful social and economic reforms implemented by the Government of Abu Dhabi which have enhanced the appeal and attractiveness of the emirate as a premier investment destination for institutional and international investors. such as Apollo, the senior official said.
The strategic and long-term perspective of Apollo’s investment supports both the fundamentals of the Abu Dhabi property market and Aldar as a platform for excellence and continued growth. The long-term agreement, which will see Apollo and Aldar examine other opportunities in the future, will enable Aldar to accelerate and advance its transformational growth agenda.
Following the transaction, which is expected to close by the end of the first quarter of 2022, Aldar will receive significant cash proceeds which are intended to drive our transformational growth program as we seek to accelerate the effective deployment of capital in our strong development pipeline. and valuable investment opportunities, he added.
Aldar Investment CEO Jassem Busaibe said: “Diversifying our investor base and building partnerships is a key tenet of our growth strategy and is essential for us to grow, improve asset diversification and drive earnings growth.”
“We wholeheartedly welcome Apollo as a long-term strategic investor and look forward to working together to grow our portfolio through additional value and accretive acquisitions. crucial step in our next growth journey,” he added.
Apollo CEO Marc Rowan said, “By leveraging our global integrated investment platform and permanent capital base, we have been able to structure a capital solution to support Aldar’s transformational growth agenda. while allowing our investors to access a very attractive long-term return.”
Aldar’s investment marks Apollo’s latest engagement in Abu Dhabi and the United Arab Emirates. It follows a 2020 strategic partnership with Mubadala Investment Company, as well as a long-term joint venture with ADNOC in which Apollo funds and clients led a $2.7 billion real estate joint venture investment. , he added.TradeArabia Press Office