Thursday, July 24, 2008

Abu Dhabi fund gains General Electric stake in $40bn partnership

The 130-year-old US industrial empire General Electric is cosying up to a Middle Eastern sovereign wealth fund in a commercial partnership that will make Abu Dhabi's government one of its biggest shareholders.

GE has struck a broad-ranging deal with Abu Dhabi's Mubadala fund to pool financial resources in finding $40bn (£20bn) of business opportunities in the Middle East and Africa, ranging from aviation and oil to clean technologies, green energy and water purification.

To cement the deal, Mubadala intends to buy sufficient stock on the open market to become one of GE's 10 biggest shareholders. GE's shares rose 66 cents to $28.35 in early New York trading yesterday.

GE chief executive Jeffrey Immelt said he saw similarities between his company and the Abu Dhabi fund. "When we look at Mubadala we see a kind of GE in the making, if you will. We see a company that is an industrial company and a financial company with a new generation of leaders."

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