BAKU, Azerbaijan, January 28. The State Oil Fund of the Republic of Azerbaijan (SOFAZ) and the Arab Energy Fund (TAEF) have partnered with CVC DIF (formerly DIF Capital Partners) to invest in PAL Cooling Holding (PAL) through a joint investment structure created to secure a 50% stake in the company, Trend reports, citing the Fund.
According to the Fund, this collaboration reflects a shared strategic approach aimed at developing regional infrastructure projects that enhance energy efficiency.
In June 2025, leading global private market investment manager CVC, together with Tabreed, one of the world’s leading centralized cooling companies, agreed on the acquisition of PAL Cooling Holding LLC. Through the joint venture formed by CVC DIF and Tabreed, PAL was acquired with a 50/50 ownership split, with the deal’s capital valued at approximately 3.8 billion UAE dirhams.
PAL Cooling Holding is the second-largest centralized cooling operator in the UAE, operating under eight long-term concession agreements averaging 25 years and serving over 45,000 clients. The company plays a key role in building reliable, efficient, and sustainable cooling infrastructure in the country’s main development zones.
The partnership between TAEF and SOFAZ with CVC DIF unites three institutional investors on a single platform, leveraging capital and sector expertise to strengthen PAL’s operational resilience and support the implementation of its long-term development strategy. Tabreed retains a 50% stake in the joint venture, contributing its extensive experience in centralized cooling across six countries and managing 99 facilities.
“We are pleased to partner with CVC and the State Oil Fund of Azerbaijan on this significant investment in PAL. Centralized cooling plays a crucial role in energy efficiency, and we are supporting a platform with high operational performance. This partnership reflects TAEF’s strategic approach of targeting long-term, impactful investment platforms and collaborations,” TAEF CEO Khalid Ali Al-Ruwaigh said.
To this account, SOFAZ’s strategic dedication to the UAE and the wider Gulf area received significant recognition.
“Our involvement in this landmark project underscores SOFAZ’s strategic commitment to the UAE and the broader Gulf region. District cooling is a cornerstone of energy-efficient, modern urban development, and this investment advances our goals of strengthening cross-border economic cooperation and forging strategic partnerships. We are proud to expand our presence in Abu Dhabi alongside trusted partners, contributing through this consortium to the region’s broader sustainability and long-term development objectives,” SOFAZ Deputy Executive Director Rovshan Javadov highlighted.
In this context, it's also significant to underscore SOCAR and The Arab Energy Fund (TAEF).
“We are thrilled to partner with SOCAR and TAEF in this venture. This collaboration perfectly reflects CVC’s long-term commitment to the region, especially the UAE, and aligns with our strategy to invest in businesses that drive national development. PAL Cooling represents a high-quality investment with strong potential for sustainable growth and long-term value creation, while delivering reliable returns for all our investors,” CVC DIF Investment Director and Partner Alvaro Ruiz Nolasco said.
About the Arab Energy Fund
TAEF is a multilateral financial institution dedicated to the energy and utilities sectors across the Middle East and North Africa (MENA) region. Established in 1974 at the initiative of ten oil-exporting Arab countries, TAEF provides financing through credit and equity instruments to drive the development of the region’s energy sector. Its work focuses on strengthening energy security, promoting sustainable energy solutions, and expanding local value chains and services across MENA. The Fund partners with leading public and private sector institutions in more than 35 markets, offering comprehensive financial solutions that cover all stages of the energy value chain. Guided by environmental, social responsibility, and corporate governance (ESG) principles, TAEF dedicates roughly 20% of its $5.8 billion loan portfolio to environmental and social projects. It is the only financial institution in MENA with an exclusive focus on energy and holds strong international credit ratings of "Aa2" from Moody’s, "AA+" from Fitch, and "AA-" from S&P.
About SOFAZ
Established in 1999, the State Oil Fund of Azerbaijan (SOFAZ) is a sovereign wealth fund responsible for collecting and efficiently managing the country’s oil and gas revenues. Its primary mission is to safeguard and grow these revenues for future generations through long-term, sustainable management. Today, SOFAZ manages total assets exceeding $70 billion and implements a globally diversified investment strategy spanning debt and money market instruments, equities, gold, real estate, and infrastructure.
About CVC DIF
CVC DIF is a leading global private equity fund manager specializing in the middle-market infrastructure segment. Founded in 2005 and headquartered in Amsterdam, the Netherlands, CVC DIF currently oversees approximately €19 billion in infrastructure assets across energy transition, transportation, utilities, and digitalization sectors. With over 250 employees operating from 12 offices worldwide, the firm combines global reach with strong local networks and sector-specific expertise. CVC DIF forms part of CVC’s broader infrastructure strategy, benefiting from the firm’s extensive global platform of 30 offices across six continents, enabling access to unique investment opportunities and long-term growth potential.
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