Middle Eastern governments are discovering the private equity funds in an eye-catching fashion. It may be the Carlyle Group's deal to sell a 7.5 percent stake to the Abu Dhabi government. Its investment arm will only be the first of many deals. Apollo Management was also rumored recently to be in talks to sell a stake to an Abu Dhabi government affiliate, according to Investment Dealers' Digest. For buyout funds, sovereign wealth is a great source of capital, of which you really can't get enough. The Blackstone Group's deal with China is another good example. Cash-rich countries face the same need to diversify and generate returns that U.S. institutions do. We'll see a lot more investments in financial services companies. So the fit was inevitable, political concerns notwithstanding.   

For more:
- here's the article from Investment Dealers' Digest

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