Dubai Holding Eyes U.S. in First Post-Crisis Overseas Investment

  • Investment company sees opportunities in new technologies
  • Dubai joins Qatar in expressing interest in U.S. investments

Dubai Holding LLC, an investment company owned by the emirate’s ruler, may look at U.S. acquisitions again in what would be its first overseas investment since the financial crisis.

The holding company said "new technologies" in the U.S. are a potential area of interest as it diversifies outside its home market, Ahmad Bin Byat, vice chairman and managing director of Dubai Holding, told reporters on Tuesday. He didn’t give more details.

"We may go back into the U.S., " he said. "Dubai Holding will continue to invest outside Dubai for diversification purposes. When you become as big as us, you have to do that."

During the emirate’s boom years, government-related entities amassed overseas assets such as luxury retailer Barneys New York Inc., U.S. hotel and casino group MGM Resorts International and Canadian entertainment company Cirque du Soleil Inc. Many assets were then sold during the financial crisis as companies delayed debt payments after asset prices slumped and credit markets froze.

Dubai Holding’s Dubai Group LLC unit sold the Jumeirah Essex House, an 80-year-old hotel on Manhattan’s Central Park South, to Strategic Hotels & Resorts Inc. for $362.3 million in 2012 after acquiring it in 2005. The group bought the property for $440 million and spent $90 million more on renovations, according to Real Capital Analytics Inc., a New York-based research firm. The company also had a portfolio of other U.S. real estate assets.

Dubai Group and Dubai International Capital LLC, another Dubai Holding investment arm, reached an accord with creditors to restructure about $8.5 billion of liabilities in 2012 and 2013.

Dubai Holding has assets valued at about 130 billion dirhams ($35.39 billion) excluding land banks, he said. About 5 to 6 percent of their assets are overseas, Bin Byat said. The company expects net income of about 5.5 billion dirhams this year, he said, after first-half profit of 2.6 billion dirhams.

Dubai Holding’s interest in investing in the U.S. follows an announcement by the Qatar Investment Authority in September that it plans to invest $35 billion in the country over the next five years to diversify. The fund, which helps manage the country’s energy-generated wealth, opened an office in New York to better access investment partners.

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