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Tue 30 Nov 2010 03:56 PM

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Mubadala agrees to invest $100m with Verno fund

Deal is the first by a sovereign wealth fund from the Middle East in Russia

Mubadala agrees to invest $100m with Verno fund
FIRST INVESTMENT: Mubadala made its first investment in Russia with a $100m investment in hedge fund, Verno Capital

Mubadala Development Co will make a $100m investment with Russian hedge fund Verno Capital, the first by the investment arm of the Abu Dhabi government in Russia.

In an emailed statement sent on Tuesday, Khaldoon al Mubarak, chief executive officer, said that the country’s “recent economic performance and the future potential for the broader region make it an exciting new market for Mubadala."

Mubadala may add to its investment, which is also the first by a sovereign wealth fund from the Middle East in a Russian focused equity fund, Dimitri Kryukov, chief investment officer of Verno, said in emailed comments, also on Tuesday.

“This vote of confidence is a signal to top emerging market investors around the globe,” he added.

More funds from the Gulf region may invest in Russia after the country’s presidential elections in 2012, Chris Weafer, chief strategist at UralSib Financial Corp, said in an interview in Abu Dhabi yesterday.

A group of investors in talks to buy a 10 percent stake in VTB Group, Russia’s second biggest lender, includes sovereign wealth funds from the Arabian Gulf, VTB’s President Andrei Kostin said in an interview with the Financial Times, published on Oct 5.

“What we hear from the majority of the big funds, including here in the Gulf, is that they’re certainly a lot more interested in Russia than five or six years ago,” Weafer said.

Verno was set up by Kryukov at the start of the year after his departure from investment firm Kazimir Partners. It has $116m under management, he said.

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