Thursday 21, June 2018 by Bloomberg

Colony Capital to buy some of Abraaj's Key funds


Staff in eight offices will be transferred as part of the agreement

Colony Capital Inc. agreed to buy some of Abraaj’s key funds and oversee others as the Dubai-based private equity firm attempts a court-supervised restructuring amid allegations of misused funds.

The US asset manager reached an initial agreement to acquire Abraaj’s Latin America, sub-Saharan Africa, North Africa and Turkey funds management business, as well as its limited partnership interests in the underlying funds, Abraaj said in an emailed statement without mentioning the value of the deal. Staff in eight offices will be transferred as part of the agreement.

Colony also agreed to oversee other Abraaj funds on an interim basis so the buyout firm and its stakeholders “have a comprehensive global solution in place.” The agreement has received in principle regulatory approval and is expected to be completed by 1 July.

 “We are delighted to have crafted this comprehensive global solution for Abraaj and its stakeholders and sincerely hope that this can enable the process of rebuilding on all sides and also bring an end to the speculation that has swirled around Abraaj over the last months,” Colony Capital Executive Chairman Tom Barrack said in the statement.

Abraaj, once one of the developing world’s most influential investors, this week said a court in Cayman Islands appointed provisional liquidators for its holdings and investment management units. The move comes less than five months after some of its investors, including the Bill & Melinda Gates Foundation, commissioned an audit to investigate the alleged mismanagement of money in Abraaj’s healthcare fund.

Colony Capital ended talks to buy a majority stake in Abraaj’s fund-management unit after its due diligence efforts raised concerns about the company, people familiar with the matter said less than a month ago.

Features & Analyses

Wealth Management Why is there no inflation?

  Mark Burgess, Deputy Global CIO & CIO, EMEA, Columbia Threadneedle Investments, writes about one of the biggest questions… read more