Alpha Dhabi Holding signed an agreement on 26 October to commit $1 billion (approximately AED 3.67 billion) to the global AI-focused Alpha Wave III fund, following a $2.5 billion commitment to an earlier fund in 2022, The National reported. The Abu Dhabi-listed investment company will gain exposure to companies selected by Alpha Wave Global, which manages the new fund.
Key points
- Alpha Dhabi has agreed to commit $1 billion (approximately AED 3.67 billion) to Alpha Wave III, subject to applicable approvals.
- The fund is expected to invest globally in AI and other high-growth technology businesses.
- Alpha Dhabi plans to use distributions from Alpha Wave Ventures II and existing resources to meet the new commitment.
- Its 2022 commitment to Alpha Wave Ventures II was Dh9.2 billion ($2.5 billion).
Alpha Wave III will draw capital over time
The agreement was announced in Abu Dhabi on 26 October. Alpha Wave III is expected to invest worldwide in AI companies and other high-growth businesses developing or applying new technologies, Alpha Dhabi said. The commitment remains subject to applicable approvals, according to the company’s announcement.
Alpha Dhabi’s capital is to enter the fund as Alpha Wave Global makes capital calls under its investment programme. The $1 billion commitment therefore sets the amount Alpha Dhabi has agreed to provide, while the company says deployment will take place over time. The fund’s returns will depend on the performance and valuations of the businesses it backs.
Alpha Dhabi expects to receive value through distributions and exits during the fund’s life. It said the timing of deployment and the performance of the underlying investments will determine when the commitment affects its financial results.
Hamad Al Ameri, Alpha Dhabi’s managing director and group chief executive, said the agreement supports the company’s portfolio-diversification objectives and its focus on long-term value creation. Alpha Dhabi manages more than 250 public and private investments across 45 countries, according to its announcement.
Alpha Wave Ventures II supplies a funding route
Alpha Dhabi intends to pay for the Alpha Wave III commitment using cash distributions recycled from Alpha Wave Ventures II alongside existing resources. The earlier fund, launched by Chimera Capital and Alpha Wave, gave the company indirect exposure to SpaceX, OpenAI and Anthropic. Its exposure came through a fund investment rather than direct holdings in those companies.
Alpha Dhabi committed Dh9.2 billion ($2.5 billion) to Alpha Wave Ventures II in May 2022. That arrangement comprised a Dh2.6 billion capital contribution and a Dh6.6 billion undrawn commitment, which was to be called over time for investments in growth-stage companies globally.
The new fund has a stated focus on AI, while the earlier vehicle provided exposure that includes OpenAI and Anthropic. Cash received from that vehicle is among the resources Alpha Dhabi plans to put towards Alpha Wave III.
OpenAI has also been the subject of $30 billion funding talks with BlackRock and UAE funds, AI Affairs reported. Alpha Dhabi’s agreement concerns an investment in a fund managed by Alpha Wave Global.
Regulatory approval remains a condition
The Alpha Wave III commitment is subject to regulatory approvals, AGBI reported. Alpha Dhabi’s agreement sets out a commitment to the fund, with payments to follow the manager’s capital calls rather than a single immediate deployment.
International Holding Company owns 58 percent of Alpha Dhabi, according to Abu Dhabi Securities Exchange data cited by AGBI. The exchange is where Alpha Dhabi’s shares trade. The $1 billion obligation belongs to Alpha Dhabi, which has identified its earlier fund distributions and existing resources as its intended sources of payment.
Alpha Dhabi said returns from Alpha Wave III will depend on the performance and valuation of its underlying investments, with proceeds expected through distributions and exits over the life of the fund.
