--Mubadala 2011 loss due to investment losses, higher R&D costs
--Revenues up 76% at AED27.9 billion on ATIC boost
--Total assets rise 73% to AED177 billion in 2011
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By Asa Fitch
Of ZAWYA DOW JONES
DUBAI (Zawya Dow Jones)--Mubadala Development Co., a strategic investment company owned by the Abu Dhabi government, said Thursday it lost almost $900 million last year as the value of its financial investments declined and research and development costs spiked.
Mubadala, which owns stakes in the U.S. conglomerate General Electric, semiconductor giant Advanced Micro Devices and private equity firm Carlyle Group, made a loss of 3.2 billion U.A.E. dirhams ($872 million) in 2011 attributable to its shareholders, compared with a profit of AED1.2 billion a year earlier.
The 2011 loss was primarily driven by negative fluctuations in the fair market value of Mubadala's financial investments, as well as a reduction in the market value of certain real estate holdings, the company said.
Mubadala's net loss on financial investments reached AED3.03 billion last year, according to the company's financial statements.
Research and development expenses meanwhile rose to AED2.95 billion, compared with AED80.3 million a year earlier, following the transfer of the government-owned Advanced Technology Investment Company into Mubadala's hands in February. ATIC holds Abu Dhabi's semiconductor research and production investments.
Despite the net loss, Mubadala's revenues increased 76% on year in 2011 to AED27.9 billion, the company said, attributing the rise mainly to the transfer of ATIC under its control. Total assets rose 73% from the year before to AED177 billion, also due mainly to the addition of ATIC to its portfolio.
In addition to owning stakes in foreign companies, Mubadala is behind some of Abu Dhabi's biggest domestic investments. These include Strata, a manufacturer of composite structures for the aerospace industry, and Emirates Aluminium. Other ventures include Sowwah Island, a new central business district being built just off Abu Dhabi's main island, and Masdar City, a renewable energy and technology district near the city's international airport.
Mubadala is a central cog in Abu Dhabi's attempt to diversify its economy away from oil. The company sold $1.5 billion in bonds last April.
-By Asa Fitch, Dow Jones Newswires, +971 4 446-1685, firstname.lastname@example.org
Copyright (c) 2012 Dow Jones & Co.
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