According to Adel Alsherawi : Istithmar buys major stake in US asset firm

DUBAI - Istithmar World Capital, the private equity and alternative investment arm of Istithmar World, has taken a majority stake in US institutional asset manager Gulf Stream Asset Management, the company said yesterday.

Gulf Stream currently manages about $3.8 billion of corporate credit portfolios for global institutional investors in 10 investment funds.

Istithmar World Capital, which has invested in over 35 companies, with an aggregate enterprise value of $9 billion, did not disclose the size or value of the stake in the North Carolina-based firm.

In a statement, the Dubai-based company, said under the terms of the agreement, the remainder of the business will continue to be owned by Gulf Stream Asset Management's Founder and Chief Executive Officer, Mark Mahoney, and his team.

"Our investment in Gulf Stream comes in line with Istithmar World's strategy to expand beyond our core focus on private and alternative equity investing into credit and credit-related investment activities," said Adel Al Shirawi, Vice-Chairman of Istithmar World, which currently has $6 billion worth of assets under management.

"We believe that the current state of the credit markets provides Gulf Stream Asset Management with unparalleled growth opportunities in credit and credit-related investing. The financial vertical of Istithmar World continues to demonstrate stellar performance, and this transaction represents another significant achievement. We look forward to supporting Mark Mahoney and his team as we grow the business together," Al Shirawi added.

David Jackson, Chief Executive Officer of Istithmar World Capital, said current conditions in the credit market provided a good window of opportunity for growth.

"Istithmar World is well poised to capitalise on this growth opportunity by partnering with Gulf Stream whose investment experience and judgment in credit related vehicles will be an invaluable asset. This investment supports Istithmar World's strategy of unlocking growth and expansion potential in credit-related investment activities, as it continues to broaden its private equity initiatives."

"The entire firm is delighted to partner with Istithmar World in the next stage of Gulf Stream's evolution," said Mahoney. "By becoming part of Istithmar World's portfolio, we will have the capability to capitalise upon expansion opportunities the two firms have jointly identified. The opportunity to build a global asset management platform in conjunction with the resources of Istithmar is extremely exciting for our team."

Mahoney said the deal meant Gulf Stream now had the capability to build a global asset management platform with the resources of Istithmar. Lehman Brothers Inc. served as financial advisor to Istithmar World Capital.