Abu Dhabi Sovereign Wealth Fund Sells US Stocks at Highs, Cashing Out Billions

Abu Dhabi's two major sovereign funds have taken action this week, cashing out on high global stock markets. Mubadala Investment Company completed a block trade in GlobalFoundries on Tuesday night, cashing out approximately $1.9 billion; the Abu Dhabi Investment Authority, on the other hand, cashed out $273 million through the share offering of medical supplier Medline.

In its statement, Mubadala emphasized that GlobalFoundries remains an important long-term investment target, and after the sale, the fund still holds 73% of the company's shares. Mubadala said it has a "high level of recognition" for the strategic direction of GlobalFoundries and believes that expanding the shareholder base will further strengthen the company's market position.

This offering by Medline is the second cash out for the Abu Dhabi Investment Authority this year. The fund had already obtained $253 million in March through a reduction, with a total cash out of over $500 million from both instances.

The above reduction actions took place as global stock market sentiment continues to heat up. The S&P 500 has risen more than 19% since its low in March, providing a favorable window for sovereign funds to lock in profits at the right time.

It is worth noting that large-scale cashing out does not mean that these two major funds are turning conservative. On the same day, power equipment company Innio set the terms for its $2 billion IPO, and the Abu Dhabi Investment Authority holds a significant minority stake in Innio's parent company, from which it will gain considerable returns. Last week, the Abu Dhabi Investment Authority also participated in CVC Capital Partners' acquisition offer for Italian pharmaceutical company Recordati, which valued Recordati at approximately €10.7 billion.

The rhythm of selling the old and buying the new indicates that Abu Dhabi's sovereign funds are actively optimizing their portfolio structure at high market levels, rather than simply retreating.