Transformative Impact of Dubai International Capital

Dubai International Capital (DIC) has been one of the major players in the global investment map since its establishment in 2004. As the international investment arm of Dubai Holding, DIC is responsible for managing private and sovereign wealth funds of the royal family of Dubai as well as many investors across the world. The diversified public and private equity and emerging market portfolios are held by the company with the aim of building internationally diversified assets that generate value to Dubai and its stakeholders.

Over the years, DIC has established a solid reputation as a global investment powerhouse that has been actively acquiring and managing assets worldwide across various sectors. Its strategic and diversified investments have made giant strides for Dubai in making it a premier financial hub. Let’s take an in-depth look at the divisions of DIC as well as the transformative investments that have shaped its portfolio.

DIC is organized into three major business segments that include Private Equity, Emerging Markets, and Public Equities. The objective in each of these segments is to maximize returns and build long-term growth. This helps DIC make strategic investments into high-potential companies and projects, in particular within Europe and North America, as well as the MENA region.

DIC executes its Private Equity business through companies that are generally mid-cap-sized across European and North American geographies. Some of these notable investments are made by DIC in various sectors, such as hospitality, engineering, and industrial packaging. Major acquisitions under this strategy include Travelodge, the budget hotel chain with the highest market share in Europe, and Doncasters, a British precision engineering company. Combining private equity with world-class attractions is part of the strategy, as in the 2007 merge of The Tussauds Group and Merlin Entertainments, creating the second largest visitor attraction operator worldwide after Disney. DIC is ahead in infrastructure, energy, and growth capital investments. The company formed Jordan Dubai Capital with $300 million and created Ishraq, with an investment amount of $150 million, and has a definite goal of boosting the budget hotel idea all over the Middle East. Such ventures have further assisted DIC in helping in economic growth and development in the region while creating new opportunities in sectors that have long-term growth potential.

Using DIC’s Global Strategic Equities Fund, the company bought high-profile equities with giant Fortune 500 companies, for example, Daimler AG, Sony, and EADS. By putting investment in major world-wide businesses, DIC had fortified its portfolio and at the same time set a foot-hold into industries like automotive manufacturing, entertainment, and defence.

Some of the most significant deals on DIC include the acquisition of The Tussauds Group in 2005 for £800 million. This entertainment brand was one of the strongest holdings in DIC’s private equity portfolio. More recently, in a savvy deal, DIC merged The Tussauds Group with Merlin Entertainments, which propelled Merlin into the position of the global leader as the world’s second-largest visitor attraction operator. The company retained an 18% interest in Merlin Entertainments until it sold the business in 2010, thereby further defining DIC as the investment manager that systematically delivered strong returns. The most significant acquisition was made by DIC in 2006 by acquiring Doncasters Group Ltd. for £700 million. The Doncasters Group is a highly respected precision engineering company with strong presences both in the US and the UK, providing components that are vital to aerospace, automotive, and energy industries worldwide. The investment of DIC in the leaders of industrial domains like Doncasters signifies their interest in promoting innovation and growth in key global industries.

The DIC also played an extremely important role in the infrastructural and economic developments of the Middle East. In 2006, DIC launched the $500 million MENA Infrastructure Fund based on a joint partnership with HSBC and Waha Capital, targeting investments in infrastructure and energy projects all around the region. Critical infrastructure support has facilitated the modernization and development of economies across the Middle East and North Africa. Its purchase of a share in the UAE-based luxury goods retailer Rivoli Group further sealed DIC’s aspiration towards that growing consumer market. KEF Holdings, a UAE foundry and a leading player in the oil and gas industry, was another of DIC’s investments, contributing to the economic diversification of the UAE.

It has strategically invested in some of the best known companies in the world. To illustrate, in 2005, DIC acquired a 2 percent interest in Daimler AG, which placed it as one of the largest shareholders at that time. DIC has also invested in Sony and EADS because of the company’s belief that they have long-term growth potential.