Fitch rates Mubadala Development Company PJSC 'AA'; outlook stable

Fitch has applied its parent and subsidiary rating linkage methodology in the rating of Mubadala, concluding that a strong relationship exists between Mubadala and the Emirate of Abu Dhabi ("Abu Dhabi", 'AA'/Stable), and as such the rating of Mubadala has been aligned with Fitch's sovereign rating of Abu Dhabi.

Mubadala is in the early stage of its development, and lacking positive cash flow generation due to its large investment needs.

Mubadala was established in 2002 through Emiri Decree No. 12.

It is fully owned by the Government of Abu Dhabi, which has mandated Mubadala to drive economic diversification in a manner that furthers social development and to ensure the deepening of wealth for future generations.

Furthermore, Mubadala's mission, as set forth by the Government, is to achieve commercial returns while advancing the Government's broader policy aims, including building Abu Dhabi's new economy, and improving the quality of life for the people of Abu Dhabi.

Board membership includes five members of the Abu Dhabi Executive Council, the most prominent being the Chairman, His Highness Sheikh Mohammed Bin Zayed Al Nahyan, Crown Prince of Abu Dhabi.

Additionally, Mubadala's 100% state ownership status is mandated by law and unlikely to change.

It can only be dissolved after 2052 (50 years from its formation), by Emiri decree or if its mandate is deemed complete.

There is a long track record of direct government support through substantial frequent equity contributions, totalling $6.9bn since 2004, which is expected to continue.

Mubadala is focused on developing and managing an extensive and economically diverse portfolio of commercial initiatives.

Mubadala's commercial strategy is fundamentally built on long term capital intensive investments that deliver strong financial returns.

The company manages a multi-billion dollar portfolio of local, regional, and international investments, projects and initiatives.

There is limited public financial information available about the group.

Mubadala does however report annually to its shareholders under International Financial Reporting Standards.

Mubadala's debt is not guaranteed by the Sovereign but Fitch's opinion is that Mubadala's high profile and strategic role mean that support would be provided if required.