Microsoft will invest $1.5 billion for a minority stake in G42, an AI firm in the UAE.

The companies said they will co-develop and deliver AI solutions with Microsoft Azure to various industries and markets across the Middle East, Central Asia, and Africa.

G42 and Microsoft AI
– G42 on LinkedIn

As part of the deal, Microsoft’s Brad Smith will take a seat on the G42 board. The deal also includes the joint establishment of a $1 billion fund for developers in the UAE to boost AI.

The partnership is backed by assurances to the US and UAE governments to ensure the responsible and secure deployment of AI and compliance with international trade, security, and business integrity standards.

Under the terms of the partnership, G42 said it will expand its commitment to deploying Microsoft Cloud offerings and migrate its data platform and digital infrastructure to Microsoft Azure.

G42’s Arabic Large Language Model, Jais, will also be available in the Azure AI model catalog. The companies said this model will offer over 400 million Arabic speakers the opportunity to use generative AI.

G42 first announced it would be spending $900 million on the development of Jais using Cerebras chips in July 2023.

Founded in 2018, G42 is an Abu Dhabi-based AI and cloud computing firm that offers solutions to the oil and gas sector, as well as government, healthcare, and finance.

Headed up by Tahnoun bin Zayed Al Nahyan (son of the founder of the UAE), the company has been accused of developing spying tools for the state.

G42 is led by CEO Peng Xiao, who previously worked for DarkMatter, which is accused of being a state-surveillance-for-hire cybersecurity firm. There, he helped develop Pegasus, a spying software that was allegedly used by the Saudi Arabian government to hack journalist Jamal Khashoggi’s phone prior to his murder. G42 has denied a connection between the two companies.

The company recently partnered with Kenya’s EcoCloud to build a geothermal data center in Kenya. G42’s other data centers operate under the Khazna Group, named after the company acquired Khazna data centers in a joint venture with the Etisalat Group in 2021. The Khazna Group is currently the largest data center provider in the region, operating 12 data centers.

Microsoft and G42 partnered up last year to set up a sovereign cloud platform to leverage and expand the use of Khazna’s facilities.

Core42 and M42, two G42 subsidiaries, have also worked with Microsoft to move First Abu Dhabi Bank’s data center to Azure and to analyze data for biomedical research using the Terra platform, respectively.