Adia names PE head, eyes more co-investment

The Abu Dhabi Investment Authority has hired Sherwood Dodge as it steadily builds its in-house capabilities with a view to doing more private equity co-investment.
Adia names PE head, eyes more co-investment

Abu Dhabi's main sovereign wealth fund has hired Sherwood Dodge from US conglomerate GE as global head of private equities as the institution continues to build its principal investment capabilities and do more private equity co-investment.  

His mandate will encompass investments in PE funds, principal investments, secondary fund investments and private credit. He reports to Hamad Shahwan Al Dhaheri, executive director of the private equities department at the Abu Dhabi Investment Authority (Adia).

Dodge’s role was previously held by James Kester, who left in mid 2013 after two-and-a-half years with Adia. The responsibilities were shared among the team in the interim.

The SWF – with assets under management of $773 billion, according to the Sovereign Wealth Fund Institute – started allocating to private equity in 1989. Its PE allocation is between 2% and 8% and tends to remain between the middle to higher part of that range. That remains the case.

What has changed in recent years, however, is that Adia has been building its internal capabilities, mostly on the principal investing side. It has expanded its principal investment team to around 15.

This has come alongside the overall expansion of its illiquid assets team – covering infrastructure, real estate and private equity – to between 250 and 300 from around 100 in the past few years. Most of this has been driven by a huge increase in the real estate team to almost 200 from around 50. This reflects Adia’s shift towards a more in-house-driven investment model.

The institution does most of its private equity investing through funds, along with a small amount of co-investment, but has been looking to build its co-investment capabilities by adding more specialists to the team. The strategy has been to make larger PE commitments at an earlier stage, rather than coming into deals that are close to completion, and that shift is expected to continue.

These efforts became more visible last year with Adia’s participation in a couple of big acquisitions. It was part of a consortium – also including Singapore’s GIC and Dutch pension fund service provider PGGM – that in July bought LeasePlan Corp from Volkswagen and Fleet Investments in a deal that reportedly valued the fleet management company at around $4 billion.

Separately, in May last year, Adia partnered with investors including GIC and Canada Pension Plan Investment Board to buy 33% of the combined telecoms businesses O2 UK and Three UK for £3.1 billion.

Dodge joins Adia to help it do more such deals, after spending 25 years with GE, where he held a number of senior positions across its financial services businesses globally.

Most recently he worked in South Korea as deputy CEO and a board member of Hyundai Capital Services and Hyundai Card, the joint ventures in auto finance and credit cards between Hyundai Motors and GE.

From 2009 to 2013, Dodge was CEO of the equity business of GE Capital for the Americas, where he led its PE activities. Prior to this, he had responsibility for GE equity’s investments in the aviation and energy industries and for equity co-investments with the customers of GE Capital’s leveraged lending business.

Between 1999 and 2005, Dodge was based in London, overseeing GE Capital’s PE activities in Europe. Before this, he served as president of GE Capital Thailand.  He began his career with GE in 1988.

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