Sovereign-wealth funds have inspired political angst in the West as much for the fear that the funds will be used to national strategic ends as for their seemingly endless stream of cold hard cash.

How will those political circles react to government investment funds that have bulked up with debt in much the same way as private-equity firms do?

financialnewsMumtalakat Holdings and Investment Corporation Dubai, two of the Middle East’s largest sovereign-wealth funds, are between them raising more than $6.5 billion in syndicated loans from banks for the first time to finance their operations and potential acquisitions throughout the world.

Mumtalakat Holdings, Bahrain’s $10 billion state investment agency, and Investment Corporation Dubai, the investment arm of the Dubai government, each have mandated banks to arrange the loan financings, the biggest of which is the $6 billion debut facility from ICD, according to loans bankers.

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