Abu Dhabi fund Mubadala invests in data centre firm Yondr

Abu Dhabi state investor Mubadala has invested in London-based data centre developer Yondr Group, the fund’s latest foray into a sector that is expected to benefit from booming demand for cloud services and artificial intelligence technology (AI).

Global cumulative data centre demand is expected to grow at a CAGR of 11 per cent by 2032, driven by advancements in AI, 5G technology and the Internet of Things.

Mubadala said its investment, alongside Apollo Global Management’s, will support Yondr’s ambitious growth strategy.

The data centre infrastructure company has a contracted and reserved capacity of 878 megawatts (MW), of which 58MW are currently operational. Mubadala did not disclose the value of the transaction.

Mubadala’s investment in Yondr further expands its rapidly growing portfolio of data centre assets. The fund was invested in Aligned Data Centers, a pan-America data centre company headquartered in the US, last August, and Princeton Digital Group, a leading pan-Asian data centre company, in 2022.

The state investor also invested in major global fibre network providers such as the UK’s CityFibre and GlobalConnect, a fibre-based data communication and data centre service provider to enterprises across Northern Europe.

“This investment marks an exciting addition to Mubadala’s rapidly expanding digital infrastructure portfolio. We are witnessing strong growth in demand for hyperscale data centres in response to the rising data demands from AI adoption, 5G and IoT,” said Mounir Barakat, senior executive director of Digital Infrastructure at Mubadala.

“Yondr will play a key part in providing solutions for some of the world’s fastest-growing corporations.”

Yondr is committed to achieving net zero greenhouse gas emissions by 2030, which will involve reducing emissions across the company’s data centres through energy-efficient technologies and the use of renewable energy to power its infrastructure.

Mubadala’s assets under management rose 9.5 per cent in 2023 to $302.2bn (Dhs1.11tn). The state investor is the second-biggest state fund in Abu Dhabi, the capital of the UAE, behind the Abu Dhabi Investment Authority.

It deployed Dhs89bn in sectors including technology, digital infrastructure, life sciences, renewable energy and private credit.

The fund’s portfolio mix remained broadly similar YoY, with 38 per cent direct and indirect in private equity, 25 per cent in public markets and 16 per cent in real estate and infrastructure.

Read: Abu Dhabi fund Mubadala’s asset under management rise to $302bn