Microsoft plans $1.5bn investment in Abu Dhabi AI group

Abu Dhabi artificial intelligence group G42 is about to receive a massive investment of $1.5bn from Microsoft in its latest push into the sector.

The $1.5bn deal between Microsoft and G42 gives the former a minority stake in the latter, while Microsoft vice-chair and president Brad Smith will also gain a seat on its board, as reported by the Financial Times. This comes after G42 severed links with Chinese hardware companies and other US firms deepen ties with UAE-based businesses.

Abu Dhabi has quickly been pushing to become an AI hub, having recently founded the AI and Advanced Technology Council in January, 2023. More and more, US companies from Silicon Valley are treating the UAE as a credible technology investor.

“Our two companies will work together not only in the UAE, but to bring AI and digital infrastructure and services to underserved nations,” said Mr Smith in a statement. “We will combine world-class technology with world-leading standards for safe, trusted, and responsible AI, in close coordination with the governments of both the UAE and the United States.”

Exchanging one investment partner for another

The Financial Times went on to ask Peng Xiao, G42’s chief executive, if the deal with Microsoft was brokered as a reward for cutting ties with China, with Mr Smith directly referring to the deal as representative of closer ties with the US.

“I would focus on our decision to form this partnership with Microsoft to really develop our capabilities on a global scale. Less focus on what we choose not to do,” Peng Xiao replied.

Part of the deal means that G42 will use Microsoft’s cloud computing platform Azure when building and deploying AI services to its customers. Future stages could also see the pair collaborate to build data centers in other countries too, as well as form a $1bn fund for budding AI developers.

“Microsoft’s large investment is not something we do without a lot of thought,” Smith added. “And this decision reflects confidence by our company in the UAE as a country, in G42 as a company, and in Peng as its CEO.”

Featured image: Ideogram

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Rachael Davies