Happy Friday Everyone!

In today’s business headlines, Mubadala is considering a sale of part of its $1 billion stake in telecom giant Du, according to Bloomberg, as the Abu Dhabi sovereign wealth fund explores new opportunities. Meanwhile, U.S. venture capital firms and the CIA’s investment arm have backed Israeli military-tech startup Kela, signaling growing interest in defense tech. Lastly, Abu Dhabi’s ADQ has partnered with Energy Capital Partners for a $25 billion deal in the U.S., focusing on data center energy infrastructure to support growing power needs.

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Mubadala Considers Selling Part of $1 Billion Stake in Du: Bloomberg

📰 What is it about?

• Abu Dhabi's sovereign wealth fund, Mubadala Investment Co., is exploring the possibility of selling part of its $1 billion stake in telecom operator Du, according to sources familiar with the matter.

• Emirates NBD, First Abu Dhabi Bank, and Goldman Sachs have been tapped to advise on the deal.

• Talks are still in the early stages, with no final decisions on the size or timing of the sale.

• Mubadala holds around 10% of Du through its subsidiary Mamoura Diversified Global Holding and last reduced its stake in 2019.

💡 Why it matters?

• A potential sell-down by Mubadala could bolster the region’s follow-on equity market, which is gaining traction amid a wave of IPOs.

• Such secondary share offerings provide alternative fundraising options for governments looking to finance economic transformation plans.

• Increased free float in listed companies enhances their chances of inclusion in global indices like MSCI, improving market liquidity.

• The move aligns with a broader trend in the Gulf, where sovereign funds and state-owned firms are monetizing stakesin key assets.

🔜 What’s next?

• Mubadala’s decision will hinge on market conditions and investor appetite for Du’s shares.

• If the sale proceeds, it could mirror recent deals such as Adnoc’s $2.8 billion gas stake sale and Saudi Aramco’s $12 billion share offering.

• Du, which reported record dividends in 2024, remains a key player in the UAE’s telecom sector, making any share movement closely watched by investors.

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CIA and Two US VC Firms Just Invested in Israeli Defense Startup Kela : WSJ Reports

📰 What is it about?

• Silicon Valley venture-capital firms are investing in Israeli defense-tech startups, aiming to capitalize on the growing demand for military technologies in the U.S. and Europe.

• One notable investment is in Kela, an Israeli startup that raised $39 million to develop software that integrates commercial and military technologies for defense applications like border security.

• The CIA’s investment arm, IQT, along with major firms like Sequoia Capital and Lux Capital, are backing Kela’s growth.

💡 Why it matters?

• Israeli startups are well-positioned to compete for lucrative U.S. and European defense contracts, as military spending in these regions is set to surge.

• Israel’s defense-tech ecosystem, known for its cutting-edge innovations, has gained attention for its ability to develop technologies informed by real-world combat experience.

• The rising interest in Israeli defense firms is a strategic bet on their potential to challenge established players like Elbit Systems and Rafael Advanced Defense Systems.

• The move reflects a broader trend in U.S. defense contracting, where startups are increasingly being sought to develop new technologies in place of traditional defense giants

🔜 What’s next?

• Kela and other Israeli startups will continue to pursue large-scale defense contracts in the U.S. and Europe, potentially disrupting the market dominated by major defense contractors.

• Investors are watching closely to see if the Pentagon will open doors to non-U.S. startups, which could redefine the future of defense spending.

• As the defense-tech market grows, further investments are expected, especially in companies with combat experienceand the ability to integrate advanced technologies rapidly.

• Israeli defense startups are expected to expand their presence in key military sectors, particularly cybersecurity, drones, and battlefield technologies.

Abu Dhabi Sovereign Wealth Fund ADQ has Signed $25B Data Center Deal in US

What is happening?

• Abu Dhabi’s sovereign wealth fund, ADQ, has entered a $25 billion+ partnership with Energy Capital Partners(ECP), a U.S.-based private equity firm, to invest in energy projects to power data centres.

• The joint venture will focus on the development of 25 gigawatts of new power generation and energy infrastructure, primarily in the U.S.

• The partnership is aimed at supporting the growing energy demands of data centres, hyperscale cloud companies, and other energy-intensive industries.

Why it matters:

• The deal marks a significant step in ADQ’s strategy to diversify its investments, moving into energy infrastructure for critical global industries like cloud computing and AI.

• The partnership underscores the growing need for reliable and scalable energy solutions for the tech industry, driven by the rapid expansion of data centres.

• The agreement is seen as part of Abu Dhabi’s efforts to expand its influence in global energy infrastructure and strengthen ties with the U.S. in strategic sectors such as artificial intelligence and infrastructure.

What’s next?

• The ADQ-ECP partnership will focus on accelerating the build-out of energy infrastructure that can support the increasing demand for data centre power.

• As ADQ expands its U.S. presence, it will likely explore additional investments in technology and infrastructure, aligning with the UAE’s broader goals of economic diversification and building a competitive AI industry.

• HH Sheikh Tahnoon bin Zayed Al Nahyan, chairman of ADQ, continues to build strategic partnerships with the U.S. to enhance technological capabilities, which may lead to more joint ventures and investments in the future.

🔍In other news…

• Saudi Arabia Awards $97.5 Million Exploration Leases to Some Major Miners.

• UAE Central Bank follows Fed move to keep interest rates unchanged.

• UAE: 1 year jail, up to AED1 million fine for hiring workers without permit.

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