#UAE #investment - Investment holding company Alpha Dhabi Holding (ADX: ALPHADHABI) has signed an agreement to commit $1bn (about AED 3.67bn) to Alpha Wave III, a global fund managed by US investment firm Alpha Wave Global. The fund is expected to invest in AI and high-growth technology businesses worldwide. The commitment follows Alpha Dhabi’s participation in Alpha Wave Ventures II, which gave it indirect exposure to SpaceX, OpenAI and Anthropic. The commitment to invest remains subject to any applicable approvals.
SO WHAT? - Alpha Dhabi is recycling its returns from the last Alpha Wave fund into the next one, which says it likes what it’s seen so far, which began with an experimental Alpha Wave Incubation fund launched in 2019. The new funds predecessor Alpha Wave Ventures II (managed by Chimera Capital and Alpha Wave Global) targeted a 3x to 5x return on its investments and closed its second round of investment in January 2022 at $10 bilion. Alpha Wave’s $1 billion investment in Alpha Wave III buys exposure to AI companies without Alpha Dhabi having to pick individual winners.
KEY POINTS:
Alpha Dhabi Holding, listed on the Abu Dhabi Securities Exchange as ALPHADHABI, has signed an agreement to commit $1 billion (c. AED 3.67b) to Alpha Wave III. The investment remains subject to any applicable approvals.
Alpha Wave III is a global fund managed by Alpha Wave Global formerly Falcon Edge Capital). It is expected to invest in AI and high-growth businesses developing and applying transformative technologies.
The commitment follows Alpha Dhabi’s participation in Alpha Wave Ventures II, through which the group gained indirect exposure to companies including SpaceX, OpenAI and Anthropic.
Alpha Dhabi will deploy its capital over time in line with capital calls and the fund’s investment programme. Value is expected to be realised through distributions and exits over the fund’s life.
Alpha Dhabi intends to fund the investment from cash distributions it receives from Alpha Wave Ventures II, plus existing resources. The financial impact will be recognised over time.
Alpha Wave’s returns will depend on the performance and valuation of the underlying investments. Alpha Dhabi says the commitment is meant to support portfolio diversification and long-term risk-adjusted returns.
Alpha Dhabi manages more than 250 public and private investments across 45 countries, in sectors including AI, real estate, industry, healthcare and energy. It employs about 95,000 people.
Alpha Dhabi says it will make further disclosures as required under applicable laws and ADX rules.
ZOOM OUT - Alpha Wave Global has been working closely with Abu Dhabi for some years. In 2019, when the investment firm was still called Falcon Edge Capital, it formed Abu Dhabi Catalyst Partners, a $1 billion joint venture with sovereign wealth fund Mubadala. Shortly after that, Alpha Wave launched the $300 million Alpha Wave Incubation fund, backed by investment from ADQ. The fund targeted early-stage Indian and South East Asian start-ups and invested on a precondition that investments set-up operations in Abu Dhabi. It backed more than 20 Indian AI and emerging tech firms that all subsequently registered in the emirate including EMB Global, EkAnek (Foxy), Entropik Tech, Hippo Video, SenseHawk and Verloop.
In December 2021, the company rebranded to Alpha Wave Global and launched the Alpha Wave Ventures II fund targeting $10-15 billion of investments in global scale-ups, with a ticket size of $10 million up to $150 million. The Alpha Wave Ventures II fund did not require reciprocal investment in Abu Dhabi, but nevertheless a number of fund investments have close ties to the emirate and/or offices there.
[Written and edited with the assistance of AI]
Source: Alpha Wave
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MGX joins consortium to invest $100b in AI infrastructure (Middle East AI News)
Abu Dhabi forms global technology investment company (Middle East AI News)