Abu Dhabi’s ADQ strikes $4.2bn investment deal with Greece

ADQ, an Abu Dhabi-based investment and holding company, has signed an agreement to fund Greek investments worth 4 billion euros ($4.2 billion).

The investment partnership with the Hellenic Development Bank and Hellenic Development Bank of Investments, the sovereign fund-of-funds of Greece, covers multiple sectors and asset classes of the Greek economy.

It was agreed on Monday as the Greek prime minister, Kyriakos Mitsotakis, held talks with Crown Prince Sheikh Mohammed Bin Zayed Al-Nahyan in Abu Dhabi. The two leaders discussed energy cooperation and ways to strengthen bilateral ties, as well as the war in Ukraine, the prime minister’s office said.

ADQ and the Greek banks said their deal would drive significant investor interest in the country. The three will invest individually and jointly, across target sectors including renewable energy, infrastructure, agriculture, technology, healthcare and life sciences.

Ioannis Tsakiris, Athens’ deputy minister for development and investments, welcomed the deal, saying: “Greece and the UAE continue to forge strong and strategic partnerships underpinned by investments that provide growth opportunities for both nations. With its proven track record in establishing robust and tangible sovereign investment partnerships, ADQ is a natural partner that will contribute to achieving our economic growth.”

Mohamed Hassan Alsuwaidi, managing director and CEO of ADQ, added: “Bilateral relations between the UAE and Greece have strengthened in recent years particularly in the areas of trade and economic development. Today’s signing underlines ADQ’s commitment to build strategic partnerships with key entities that complement our investment strategy and our ability to generate sustainable financial returns. We are confident that our joint collaboration will accelerate investments that will contribute to the economic growth of both nations.”

The value of non-oil foreign trade between the UAE and Greece reached nearly AED 2.1 billion ($572 million) in 2021. This was up 67 percent on the 2020 figure and a significant increase from pre-pandemic levels.

Separately, Abu Dhabi-based sovereign investor Mubadala Investment Company and the Hellenic Development Bank of Investments (HDBI) signed an agreement to extend their €400 million co-investment partnership to include venture capital and private equity investments in top-performing Greek funds that focus on high-growth sectors.

The first co-investment under the newly extended agreement is Athens-based VentureFriends Fund III, an early-stage tech investor. 

The Mubadala-HDBI partnership was established in 2018 with an initial focus on minority direct private equity investments in Greek businesses.

Waleed Al Mokarrab Al Muhairi, Mubadala’s deputy group CEO, said: “Over the years, the economy of Greece has not only demonstrated its resilience, but it also now presents some very exciting growth opportunities. Our extended partnership with HDBI will enable Mubadala to accelerate its investments in Greece, capitalising on an increasingly active innovation and entrepreneurial landscape across multiple sectors.”

After the Abu Dhabi talks, Mitsotakis said there was room for further cooperation between the European Union and the UAE on renewable energy.

“Due to its geographical position, Greece has the potential to become a gate for natural gas from the Middle East to Europe,” he said. “We would like to explore the possibilities for further strategic cooperation and the participation of funds from the UAE in this direction.”

As part of its effort to boost the share of renewables in energy consumption to 35 percent by 2030 from around 23 percent now, Greece wants to install offshore wind parks capable of generating 2 gigawatts by 2030, with required investments seen at 6 billion euros.

Mitsotakis arrived in Abu Dhabi on Sunday, for his third official trip to the region as PM. The visit follows the signing of a Joint Declaration of Broad Partnership and Cooperation Agreement on Foreign Affairs and Defence between the two countries in November 2020.

Additional reporting: Reuters

Factfile: the Greek economy 

The Organisation for Economic Co-operation and Development is projecting that Greece’s GDP will increase by just under 5 percent in 2022, before growth moderates in 2023. 

Economic activity rebounded after lockdown measures were eased in April 2021, helped by a stronger-than-expected summer tourist season. 

Government support and investments will contribute to the recovery of employment and consumption. High levels of spare capacity will likely limit the rise in inflation. A worsening in the health situation and investment delays would imperil the projected recovery, the OECD cautioned.

Greek output shrank 9 percent in 2020, because of the COVID-19 pandemic. Recent data for 2021 showed the economy had recouped more than two-thirds of the lost GDP.

Between 2010 and 2015, Greece required three international bailouts worth more than €260 billion to prevent bankruptcy.