Azernews.Az

Ulviyya Shahin

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The State Oil Fund of the Republic of Azerbaijan (SOFAZ) has disclosed details regarding its investment in the educational institution 'GEMS Education (Global Education Management Systems), Azernews reports.

SOFAZ pursues investments in alternative financial instruments to enhance profitability through long-term portfolio optimisation and monitoring of emerging macroeconomic trends.

"In this context, the investment of $100 million in 'GEMS Education' was undertaken as part of an infrastructure investment and an alternative financial instrument. Currently, over 135,000 students are enrolled across more than 40 GEMS schools in the UAE. Generally, SOFAZ's investment strategy, guided by global indices and benchmarks, includes a substantial portion in developed countries. Additionally, the fund strategically allocates investments, considering regional dynamics and sectors with growth potential. The Gulf region, particularly the UAE, is a leading global hub for private secondary education, driven by a growing population and its emergence as a financial centre. The education sector, known for its stable long-term income potential, typically delivers steady returns with minimal susceptibility to economic fluctuations."

"The joint investment in GEMS Education alongside prominent international partners underscores SOFAZ's recognition as a trusted investor on the global stage," the statement emphasised.

Regarding the investment duration in GEMS Education, SOFAZ indicated a typical long-term approach (5-8 years) for alternative financial instruments geared towards high profitability: "Unlike stocks, investments in fixed-income securities and quoted instruments are closed and span a lengthy period. SOFAZ's alternative investments aim at promising growth prospects, with management companies employing various strategies to enhance financial performance, increase investment value, and achieve high profitability. Realising substantial growth and potential expansion necessitates several years to yield desired outcomes."

"Notably, SOFAZ, as part of a consortium, invested $100 million in GEMS Education, among the world's largest private educational institutions based in Dubai. Managed by Brookfield Asset Management, a leading global alternative investment firm specialising in infrastructure, industrial, and business services, the consortium also included reputable local and international investment institutions. Founded in 1899, Brookfield Asset Management commands significant influence in the market, managing assets totaling $900 billion."

It's worth mentioning that on January 27, 2023, President Ilham Aliyev met with Bruce Flatt, CEO of Brookfield Asset Management.

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