DUBAI, 6 July 2007 — The $2 billion Global Strategic Equities Fund (GSEF), founded and sponsored by Dubai International Capital (DIC), bought a 3.12 percent stake in the European Aeronautic Defense and Space Company (EADS) as part of its plan to invest in global companies.
The GSEF stake “allows it to become one of the largest institutional shareholders in the company,” it said in a statement yesterday.
“In line with GSEF’s investment strategy, neither the fund nor DIC will seek a Board seat or take an active role with EADS but will seek to build a strategic relationship with the EADS management and shareholders,” it said.
``We are confident that EADS’s superior product offering, comprehensive restructuring program and committed management’’ make it a good investment, Dubai International chief executive officer Sameer Al-Ansari said.
DIC didn’t disclose any financial details, but sources said the investment brings the fund closer to reaching its $10 billion global investment target.
This transaction comes less than two months after GSEF made a substantial investment in HSBC Holdings plc, the pre-eminent global financial services firm, becoming one of the leading shareholders in the company. Both investments are a part of GSEF’s mandate to invest in global Fortune 500 companies following the recent closing of its first round of fundraising efforts at $1billion in February 2007. The fund seeks to become a leading shareholder in pre-eminent global large capitalization stocks, whilst aiming to create value through long-term exposure to a concentrated portfolio of undervalued companies.
EADS, the world’s second largest aerospace conglomerate, is the parent company of European aircraft maker Airbus, helicopter supplier Euro copter and European space company EADS Astrium. It is the major partner in the Euro fighter consortium, develops the A400M military transport aircraft, and holds a stake in the MBDA joint venture, the international leader in missile systems.
Dubai International has spent $6 billion since 2004 buying stakes in DaimlerChrysler AG, Doncasters Plc and Travelodge Hotels. Last year, Dubai-owned DP World, the third-biggest container port operator, bought Peninsular & Oriental Steam Navigation Co. for $6.8 billion.
EADS employs about 116,000 people at more than 70 production sites, above all in France, Germany, the UK and Spain as well as in the US and Australia. In 2006, the company generated revenues of 39.4 billion euros.