Saudi IT company Al Moammar Information Systems (MIS) and financial services provider BSF Capital (Banque Saudi Fransi) to expand the former's data center footprint.
The companies have signed an agreement to increase the capacity of data centers in the kingdom by up to 64MW.
The deal has an estimated value of between SAR 1.85 billion ($520m) and SAR 2.5 billion ($666m).
According to a report from Zawya, BSF Capital signed the letter of intent on behalf of the Saudi Data Centre Fund 1; a shariah-compliant, close-ended investment fund set up in 2021 by MIS and Saudi Fransi Capital.
Saudi Data Centre Fund 1 was founded with the aim of constructing six hyperscale data centers in the kingdom with a combined IT capacity of 24MW.
Details of these data centers have not been disclosed.
The deal is expected to close in around 90 days once the parties reach mutually agreed-upon terms.
Based in the capital city of Riyadh, MIS was founded in 1979 as the country’s first publicly listed IT company. Historically, the company has offered managed services, security operations, consultancy services, and managed IT. Last year in July the company announced it had set up a wholly-owned subsidiary for its data center operations.
Saudi Arabia has recently attracted increased digital investment, with AWS planning to invest more than $5.3 billion in the kingdom and launch a cloud region.
Google also has a cloud region in the country, launched last November, in partnership with the world’s largest oil company Aramco. Dozens of human rights groups called on the tech giant to cancel the project due to Saudi Arabia's well-documented record of illegally surveilling its own citizens, and torture of dissidents.
Microsoft is planning its own Saudi cloud region and came up against similar calls to cancel the development.
Oracle and Huawei have each launched Saudi cloud regions in recent years.
DataVolt, a Saudi-based data center developer, has also committed to investing more than $5 billion in developing around 300MW of data center capacity in the country.
The recent investments are all ahead of the Saudi Vision 2030; the kingdom’s effort to reduce its dependence on oil with priorities placed on smart infrastructure and digital transformation.
