Golub Capital Plants Flag in Abu Dhabi with Steiner Hire

Golub Capital, one of the largest middle-market private credit lenders in the U.S., officially opened its first Middle East office in Abu Dhabi on January 27, hiring former Mubadala Capital executive Pascal Steiner to run the operation. The move marks a geographic bet that the Gulf's surging private equity activity — and the debt financing that follows it — warrants boots on the ground in a region where most American credit funds still operate remotely.

Steiner, who joins as Managing Director, spent five years at Mubadala Capital, the asset management arm of Abu Dhabi's $302 billion sovereign wealth fund, where he led origination and coverage for the firm's alternative investments platform across the Middle East and North Africa. Before that, he worked at Société Générale Corporate & Investment Banking in Switzerland, focused on leveraged finance and debt capital markets. He'll report to Greg Cashman, Golub's head of business development, and work alongside the firm's existing London team.

The hire isn't just about origination. It's about proximity. While Golub has financed Middle Eastern borrowers in the past — largely through relationships managed from New York or London — the Abu Dhabi presence signals a recognition that regional deals, particularly those backed by Gulf-based private equity firms, require local intelligence and faster execution. Private credit's edge has always been speed and certainty. That advantage erodes when you're coordinating across time zones with clients who expect term sheets within days, not weeks.

Golub's expansion comes as private credit allocations in the Gulf have accelerated sharply. Middle Eastern institutional investors — sovereign wealth funds, family offices, pension systems — have collectively committed more than $50 billion to private credit strategies since 2020, according to data from Preqin. Much of that capital is being deployed regionally, financing buyouts, growth equity deals, and infrastructure projects across the GCC (Gulf Cooperation Council) states. The number of private equity deals in the Middle East surpassed 200 in 2024, up from fewer than 120 in 2019, per Pitchbook data. More deals mean more demand for flexible, non-bank debt — Golub's bread and butter.

Abu Dhabi's emergence as a financial hub for alternative asset managers isn't accidental. The emirate has spent the past five years courting global investment firms with a combination of tax incentives, streamlined regulatory frameworks through the Abu Dhabi Global Market (ADGM) financial free zone, and direct co-investment capital from entities like Mubadala and ADQ. Blackstone, Apollo, and KKR have all opened regional offices in recent years, drawn by the same calculus: capital is abundant, deal flow is growing, and the sovereign wealth funds writing billion-dollar checks want managers they can meet in person.

For Golub, the timing also reflects maturation in the firm's global strategy. Founded in 1994, Golub has long been synonymous with U.S. middle-market lending — financing sponsor-backed companies with EBITDA between $10 million and $100 million. But as competition in that core market has intensified — with banks re-entering the space post-Basel III adjustments and newer direct lenders raising mega-funds — Golub has steadily expanded internationally. The firm opened its London office in 2017, targeting European middle-market deals. Abu Dhabi is the next logical step in building a global origination network.

The Middle East also offers a particular opportunity for middle-market lenders. While the region has seen headline-grabbing mega-deals (think Saudi Arabia's Public Investment Fund backing $10 billion-plus transactions), the vast majority of private equity activity sits in the $50 million to $500 million enterprise value range — precisely where Golub specializes. These deals often struggle to secure financing from European or U.S. banks due to perceived country risk, currency concerns, or unfamiliarity with regional industries like logistics, food & beverage distribution, and healthcare services. Private credit funds willing to underwrite those risks can command higher spreads and tighter documentation.

Steiner's background at Mubadala is critical here. Mubadala Capital oversees roughly $30 billion in assets and has been one of the most active private equity investors in the MENA (Middle East and North Africa) region, backing buyouts in industries ranging from healthcare to industrials. Steiner's relationships with regional PE sponsors — the primary clients for direct lenders — give Golub immediate credibility and deal flow visibility that would take years to build from scratch.

Golub manages approximately $75 billion in assets across multiple credit strategies: senior secured lending, unitranche financing, junior capital, and broadly syndicated loans. The firm has deployed capital in more than 500 companies globally, with a focus on defensive, cash-generative businesses that can weather economic volatility. In the Middle East, that profile maps well onto sectors like business services, niche manufacturing, and essential consumer goods — areas where Gulf-based PE firms have been particularly active.

The firm's value proposition in the region will hinge on speed and flexibility. Regional PE sponsors frequently cite frustration with traditional bank lenders, who require months of underwriting, layers of committee approvals, and extensive covenant packages that can kill deal momentum. Direct lenders like Golub can move from term sheet to close in 4-6 weeks, with fewer lenders in the syndicate and simpler documentation. That responsiveness matters in competitive auction processes where sellers favor buyers with high-certainty financing.

Golub's credit performance also gives it an edge. The firm has maintained sub-1% cumulative loss rates across its middle-market portfolios over the past two decades, a function of conservative underwriting (typically 4.0-5.0x leverage on senior debt) and deep operational diligence. In a region where some sponsors have limited operating track records and portfolio company financial reporting can be less standardized than in the U.S. or Europe, that discipline will be tested. If Golub can maintain those loss rates while scaling in the Gulf, it'll cement the firm's reputation as a serious player. If credit issues emerge, the Abu Dhabi office risks being a footnote in the firm's global strategy.

The table above shows how Golub is following — not leading — the wave of U.S. alternative asset managers into the Gulf. But the firm's focus on direct lending, rather than private equity or infrastructure, differentiates its approach. While Blackstone and Apollo have large balance sheets and can co-invest equity alongside Gulf sovereigns, Golub's product is simpler: senior debt to finance sponsor-backed deals. That narrower mandate may actually help, as the firm won't compete with its own clients for equity allocations.

Golub isn't entering an empty market. Ares Management established a Dubai office in 2021 and has been one of the most active U.S. credit funds in the region, financing everything from healthcare roll-ups to tech-enabled services companies. European lenders like Pemberton and ICG have also been active, leveraging proximity and longstanding relationships with European PE firms operating in the Gulf. Regional banks like Emirates NBD and First Abu Dhabi Bank still dominate traditional corporate lending but have been slower to adapt to the covenant-lite, sponsor-friendly structures that private credit funds offer.

For the Abu Dhabi office to justify its existence, Steiner needs to originate 8-12 new deals annually within the first three years — roughly one transaction per quarter at scale. Those deals need to be profitable, meaning all-in yields north of 9-11% (given the incremental country and currency risks), and they need to perform. A single high-profile default in the first 24 months would spook limited partners and make fundraising for regional strategies harder.

The office also needs to function as an intelligence hub, not just an origination outpost. Golub's investment committees in New York and London will rely on Steiner's team to provide real-time market color: which sponsors are raising funds, which sectors are heating up, where regulatory or political risks are emerging. That means building relationships not just with PE sponsors, but with legal advisors, accountants, and the sovereign wealth funds themselves — the anchors of the regional ecosystem.

Golub will also face the challenge of adapting its underwriting standards to regional nuances. Financial reporting in many Gulf companies is less granular than in the U.S. or Western Europe. Audited financials may arrive late. Management teams may lack experience with private equity ownership or aggressive growth targets. Currency volatility — particularly if oil prices swing sharply — can affect cash flows in unpredictable ways. Golub's historical conservatism will help, but the firm will need to decide which risks are tolerable and which are disqualifying. Get that calibration wrong, and the Abu Dhabi office becomes a drag on portfolio returns.

There's also the question of talent. Steiner is a strong hire, but he'll need to build a team. Finding credit analysts, legal counsel, and portfolio managers with both regional experience and U.S. direct lending standards isn't easy. The talent pool in Abu Dhabi and Dubai is growing — thanks in part to the influx of global asset managers — but competition for experienced professionals is fierce. Golub will need to offer competitive comp packages and a clear path to promotion to retain top talent in a market where poaching is common.

Golub's move is part of a larger shift in how private credit funds think about geographic diversification. For most of the 2010s, the industry was overwhelmingly U.S.-centric. European direct lending grew steadily but remained a fraction of the U.S. market. Asia was largely ignored, and the Middle East was an afterthought. That's changing. As North American markets become saturated — with dozens of funds competing for the same deals and pricing compressing to levels that barely justify the illiquidity premium — managers are looking elsewhere.

The Gulf offers a rare combination: institutional capital looking to allocate, a growing private equity ecosystem, and relatively light competition from established credit funds. It's not without risks — political volatility, regulatory unpredictability, and macroeconomic sensitivity to oil markets — but for firms willing to invest in local presence and relationships, the opportunity is real. Golub is betting that the next decade of growth in private credit won't come from winning the 47th unitranche deal in Ohio. It'll come from being the first call when a Dubai-based sponsor needs $75 million to finance a Saudi healthcare roll-up.

The downside scenario isn't catastrophic, but it's instructive. If Golub struggles to gain traction in the Middle East — either because deal flow doesn't materialize, credit performance disappoints, or the firm simply gets outmaneuvered by more aggressive competitors — the Abu Dhabi office quietly scales back. Steiner stays on to manage a handful of relationships, but the office becomes a satellite operation rather than a growth engine. Golub refocuses on its core U.S. and European markets, and the Middle East becomes a footnote in the firm's annual letters to LPs.

That outcome wouldn't be unique. Plenty of asset managers have opened Gulf offices with fanfare, only to close or consolidate them when returns didn't justify the overhead. The difference between success and failure often comes down to patience. Regional markets take time to penetrate. Deals take longer to close. Relationships require years of in-person cultivation. Firms that treat the Middle East as a quick win — or worse, as a PR exercise to appease LPs demanding geographic diversification — tend to underperform. Golub's track record suggests a more disciplined approach, but the region will test that discipline.

There's also reputational risk. If Golub's first few Middle Eastern deals go sideways — either through borrower defaults, sponsor disputes, or regulatory entanglements — it could damage the firm's brand in a region where reputation spreads quickly through a tight-knit community of PE sponsors and family offices. Direct lending success in the Gulf requires not just capital, but credibility. One bad deal can close doors for years.

Conversely, if Golub executes well, the Abu Dhabi office could become a template for other regional expansions. Africa remains largely untapped by U.S. direct lenders. Southeast Asia is nascent. Latin America has seen episodic interest but lacks sustained presence from middle-market credit funds. If Golub proves that a local office, led by a well-connected regional executive, can generate attractive risk-adjusted returns outside North America and Europe, it'll validate a playbook that other firms will copy.

A few things remain unclear. First: How much capital is Golub dedicating to Middle Eastern deals? The firm hasn't disclosed whether it's raising a dedicated regional fund or deploying from its global vehicles. That matters for LP transparency and for Golub's ability to scale. If the firm is just carving out a small sleeve of capital from existing funds, the office's impact will be limited. If it's raising a standalone Middle East-focused vehicle, that signals deeper commitment — but also higher expectations.

Second: What's the governance structure? Will Steiner have underwriting autonomy, or will every deal require approval from Golub's New York-based investment committee? The answer affects speed, which is the primary competitive advantage of direct lending. If regional deals still require multiple layers of sign-off from executives thousands of miles away, Golub risks losing deals to more nimble local competitors.

Golub's Abu Dhabi expansion isn't a moonshot. It's a calculated extension of a 30-year strategy built on patient capital deployment, conservative underwriting, and long-term sponsor relationships. The firm isn't trying to reinvent itself. It's applying a proven model to a new geography. That's less exciting than a dramatic pivot, but it's probably smarter.

The Middle East won't replace North America as Golub's core market. But it doesn't need to. If the region contributes 10-15% of annual deal flow within five years, and those deals perform at or above portfolio averages, the office will have justified its existence. If Steiner can build a team that becomes the go-to debt provider for Gulf-based sponsors, Golub gains a durable competitive moat in a market where relationships matter more than brand names.

The bigger question is whether private credit as an industry can sustain its global growth trajectory. The asset class has ballooned from roughly $500 billion in AUM in 2015 to more than $1.7 trillion today, per Preqin. Much of that growth has been U.S.-driven, but the next trillion dollars will need to come from elsewhere. Europe is maturing. Asia is opening up slowly. The Middle East — with its abundant institutional capital, growing private equity ecosystem, and openness to alternative lenders — is one of the few regions where the growth story still has legs.

Golub is placing an early bet on that thesis. So are Ares, Apollo, and a handful of others. In five years, we'll know whether the Gulf became the next frontier for private credit or just another market where U.S. managers overestimated demand and underestimated complexity. For now, the firm has an office, a seasoned executive, and a region full of potential borrowers. The rest is execution.

For investors and competitors tracking Golub's Middle East strategy, a few data points will signal whether the expansion is working:

Deal volume: How many transactions does the Abu Dhabi office originate in years one, two, and three? Below five deals annually suggests the office is struggling. Above ten suggests strong traction.

Average deal size will also matter. If Golub is only financing $20-30 million deals, the office's economics won't pencil out. The firm needs to win $75-150 million transactions — large enough to justify the diligence costs and relationship investment, but still in the middle-market sweet spot where Golub's competitive advantages apply.

Finally, watch for co-investment partnerships. If Golub starts co-investing equity alongside Gulf sovereigns or family offices — either in one-off deals or through structured partnerships — it'll signal deeper regional integration and access to the largest pools of capital in the market. That level of partnership takes years to develop, but it's the ultimate validation that a foreign asset manager has earned local trust.

Private credit's global expansion isn't a sprint. It's a multi-decade repositioning of where capital gets deployed, who deploys it, and under what terms. For 50 years, corporate lending was dominated by banks operating in their home markets. Over the past 20 years, non-bank lenders chipped away at that dominance in the U.S. and Europe. The next 20 years will determine whether that shift goes truly global — or whether private credit remains a Western phenomenon with limited reach in emerging markets.

Golub's Abu Dhabi office is a small but meaningful test of that question. The firm isn't betting the farm. It's planting a flag. If the soil is fertile — if regional deal flow, sponsor relationships, and credit performance all materialize as hoped — Golub will deepen its roots. If not, the firm will quietly pull back and refocus elsewhere. That's the luxury of being a $75 billion credit platform with diversified strategies and geographies. You can afford to experiment.

But experiments still matter. Because if Golub succeeds in the Gulf, it won't be alone for long. Success attracts capital, and capital attracts competition. Within 3-5 years, every major U.S. direct lender will have a presence in the Middle East — not because they want to, but because they'll have to. The firms that moved early will have the relationships, the track record, and the credibility. The late movers will struggle to differentiate.

That's the real stakes of the Pascal Steiner hire. It's not just about one office or one executive. It's about whether Golub Capital — a firm built on Midwestern pragmatism and methodical execution — can translate its model to a region where the rules are different, the relationships are newer, and the risks are higher. The answer will shape the firm's next decade, and possibly the industry's.