An Abu Dhabi sovereign wealth fund is fast emerging as a white knight for tech firms seeking funds in a volatile market.
Mubadala Investment Co., the $284 billion state-owned fund, is defying a rout in technology valuations and becoming a go-to investor in a sector where fortunes have turned overnight. The investor backed raises this week for both Klarna Bank AB and Wefox.
Mubadala is committing its capital at a time its owner, the Abu Dhabi government, benefits from a surge in oil prices driven mainly by the war in Ukraine.
The Gulf fund is stepping in to invest in technology-focused businesses just as other investors turn away from what they see as risky assets.
“As a long-term investor, Mubadala continues to deploy capital opportunistically across a range of key sectors,” a spokesperson for the fund said.
It led the latest funding round for German insurance-technology firm Wefox, which raised $400 million at a valuation of $4.5 billion this month.
The fund also came in as a new investor in the $800 million raise by Klarna, the buy-now-pay-later giant, that saw its valuation plunge to $6.7 billion from the $45.6 billion achieved last year.
Mubadala’s first major foray into technology was when it emerged as one of the key backers to SoftBank Group Corp.’s $100 billion Vision Fund a few years back.
Mubadala is now exploring whether to back Rajeev Misra, the main architect of the Vision Fund, as he seeks to start his own fund, the spokesperson said.
More recently, Mubadala led an $768 million funding round for Turkish grocery delivery app Getir in March at a valuation of $11.8 billion.
The fund also participated in a $300 million raise for payments business SpotOn, which valued the company at about $3.6 billion. It also led a $100 million round for Swedish fintech firm Juni last month.
Mubadala is also splashing out in other areas, from health care to financial services. It’s in talks to acquire Fortress Investment Group from SoftBank in a potential deal valuing the asset manager at more than $1 billion, Bloomberg News reported this week.
Buyout firm EQT AB and Mubadala agreed to buy Swedish medical freight company Envirotainer AB for an enterprise value of about 2.8 billion euros last month.
Mubadala teamed up with another investment firm, Warburg Pincus, on a more than $2 billion deal for Informa Plc’s pharma analytics unit reached in February.