Goldman Sachs considers setting up Middle East-focused fund

Global investment bank Goldman Sachs is exploring the possibility of joining the race to set up a Middle East-focused fund.

While the bank did not specifically comment on the fund, Fadi Abuali, co-chief executive of Goldman Sachs for the Middle East and North Africa, told The National on Tuesday that it is "continuing to expand" its "presence in the Middle East across divisions”.

“This reflects our ambition to provide a dedicated local service and bring investment opportunities to our global client base, capitalising on the growth and dynamism across the Mena region."

Goldman Sachs has held talks with investors in the region about raising money for the fund, according to a Bloomberg report. Talks are continuing and the fund’s final size has not been decided yet, it said.

The move ties in with the fact that Goldman Sachs became the first Wall Street bank to secure a licence in Saudi Arabia to set up its regional headquarters there.

Goldman Sach’s plans for the Middle East fund to follow similar moves made recently by rivals including US asset manager BlackRock and Bahrain’s alternative asset manager Investcorp, as well as investments in the region by New York-listed Brookfield Asset Management.

All have been joining forces with the sovereign wealth funds in the region to raise money to invest across global markets.

Investcorp, which counts Mubadala Investment Company as its biggest shareholder, teamed up with China’s sovereign wealth fund in April to launch a $1 billion fund that will invest in high-growth companies in Saudi Arabia, other GCC countries and China.

The Investcorp Golden Horizon platform will be anchored by institutional and private investors from the GCC, and the China Investment Corporation, Investcorp said at the time.

Also in April, BlackRock signed an agreement with Saudi Arabia's Public Investment Fund to accelerate growth of capital markets in the kingdom by launching a Riyadh-based, multi-asset investment management platform.

BlackRock Saudi Arabia and the PIF expressed the intention at the time to establish BlackRock Riyadh Investment Management, which will encompass investment strategies across a range of asset classes.

Brookfield, with more than $925 billion in assets under management, has also been exploring raising dedicated funds specifically for investments in the Middle East.

Last month, a consortium led by Brookfield Asset Management signed a binding agreement to invest in Dubai-based private school provider Gems Education, with the deal’s completion expected in the third quarter of 2024.

In the same month, Brookfield teamed up with UAE-backed Alterra, a $30 billion climate fund, to raise up to $5 billion for a climate finance-focused fund that will invest in clean energy projects in emerging markets.

Alterra, a private investment vehicle launched during Cop28, aims to raise $250 billion globally in the next six years to create a fairer climate finance system.

Habib Saikaly, a 13-year veteran of JPMorgan, will be joining Goldman Sachs as head of the bank’s fundamental equity business across the Mena region, and is expected to oversee the fund’s development, Bloomberg reported.