Abu Dhabi sovereign fund Mubadala prepares to launch two Spacs

Abu Dhabi sovereign fund Mubadala prepares to launch two Spacs

Investor mania for special purpose acquisition companies is accelerating in the oil-rich Gulf, where Abu Dhabi sovereign fund Mubadala is poised to launch two Spacs and a Dubai-based asset manager is raising $200m to target mergers with companies in the Middle East.

Regional financiers have for months been planning an expansion into the booming market for Spacs, or blank-cheque companies, which first list on a stock market before searching for a company with which to merge.

Mubadala Investment Company had been approaching potential investors for two Spacs focusing on technology and healthcare, said people briefed on the meetings.

The roadshow comes as Mubadala, which had record profits and growth through 2020, reorients its core areas of investment away from petrochemicals and manufacturing towards new industries, such as technology, healthcare and infrastructure. Mubadala declined to comment.

Interest in Spacs has slowed in recent months after some disappointing share price performances and increasing regulatory scrutiny in the US.

In the Gulf, however, investors have worried about missing out on gains. Sovereign funds and family offices are also keen to use the sector to boost their investment in technology and other "new economy" businesses that have thrived through the pandemic.

"Spacs are, all of a sudden, the flavour of