Investment takes place at two levels:
- At the portfolio company level– Portfolio companies typically grow organically or through acquisitions according to their own respective strategy.
- At the ICD parent level– ICD supports the development of strategic portfolio companies where required;
– In parallel, ICD as the principal investment arm of the Government of Dubai also carries out its own investment activities that supplement the strategic activities described above. Whilst ICD has autonomy in the selection of projects in which to invest, these investments are typically aligned with the development strategy of the Government of Dubai or they can also provide a degree of diversification away from the strategic portfolio to reduce dependence on key sectors.
Funding also takes place at two levels:
- At the portfolio company level– Portfolio companies typically have direct access to a variety of funding sources and use their cumulative profits and external funding to fund their expansion. Portfolio companies typically monitor and manage conservatively their leverage through investment, risk and governance frameworks.
- At the ICD parent level– ICD parent is self-funding and does not typically receive funding or seek support from the Government of Dubai. ICD parent occasionally receives non-monetary contributions from the Government of Dubai such as ownership interests in companies or plots of land related to its subsidiaries’ development activities;
– ICD’s principal sources of income are dividends received from all its portfolio companies, profits on exits and supplementary investment returns;
– ICD also, from time to time, may solicit third party funding to support its activities. ICD monitors and manages this leverage conservatively through objectives set within ICD’s investment, risk and governance frameworks.
Return to the Government
- ICD makes distributions to the Government of Dubai dependent on the dividends it receives from its portfolio companies and on future growth and/or investment plans.