Abu Dhabi Investors Buy Share of Carlyle Group

WASHINGTON — Private-equity giant Carlyle Group said yesterday that it is selling a 7.5% share of its general partnership to an investment group owned by the government of Abu Dhabi.

The $1.35 billion sale to Mubadala Development is only the second time the Washington firm has allowed an outsider to buy into its highly profitable partnership. Carlyle sold a 5.5% stake to the California Public Employees' Retirement System (Calpers) in 2001 for $175 million.

The Mubadala investment values the privately held Carlyle at $20 billion. That is about six times the partnership's value when it sold the stake to Calpers.

Abu Dhabi is one of the seven oil-rich emirates that make up the United Arab Emirates, which has been looking for ways to invest the cash it is generating from a steady rise in oil prices. Some of the countries once sought to buy assets outright, but after the outcry over a bid to take over management of a American ports operator, many have pursued less-visible strategic investments with key firms.

As part of Carlyle deal, the Abu Dhabi government will make a separate $500 million investment in Carlyle funds.