G42, an Abu Dhabi-based artificial intelligence company, plans to broaden its presence in the United States as part of its ambitious AI expansion strategy.
Abu Dhabi's AI Powerhouse G42 Sets Sights on US Expansion
G42, the UAE's cutting-edge AI firm, is locking horns with the US market, planning to set up shop with billions in investment. The move is a strategic move to position itself as a global AI leader.
Recent corporate filings reveal the formation of a US subsidiary by G42, signaling an increase in its presence in the States. This strategic move has the backing of Abu Dhabi's sovereign investor, Mubadala.
When probed by the Financial Times, G42 confirmed its commitment to the US market expansion, adding that a legal entity had been established for this purpose. Industry insiders hint at announcements by certain subsidiaries, such as those dealing with AI applications, cloud computing, and data centers, regarding their US business plans in the upcoming months.
This surge in venture capital reflects the UAE's enthusiastic embrace of AI, placing it at the core of their economic diversification policies and forward-thinking lawmaking. Such investments are also being funneled into the US as part of an effort to bolster collaboration on this burgeoning technology.
G42 is under the watchful eye of the UAE's National Security Adviser, Sheikh Tahnoon bin Zayed al-Nahyan, who has taken a leading role in the company's strategic partnership with Washington, viewing the US as a prime source for AI technology. A stronger US presence would facilitate more substantial investments for Abu Dhabi entities.
Sheikh Tahnoon paid a visit to Trump at the White House in March, with a focus on strengthening bilateral cooperation. In the aftermath, the White House revealed that the UAE was eager to implement a staggering $1.4 trillion, ten-year investment framework in the US, surpassing the $600 billion pledged by regional rivals Saudi Arabia over four years [1].
G42 USA was established in Delaware in January, while its collaborative cloud and enterprise subsidiary, Core42, has previously set up businesses within the US and announced plans to introduce its services to American shores. Last year, G42 secured a $335 million investment in Cerebras Systems, after the Committee on Foreign Investment in the US (Cfius) granted approval for the deal, although only for non-voting shares [2].
G42's executive, Peng Xiao, a Chinese national now a citizen of the UAE, has reportedly cut ties with Chinese hardware suppliers, including Huawei, following scrutiny from US lawmakers [3].
In 2020, Microsoft shelled out $1.5 billion for a minority stake in G42, while other US investors such as Ray Dalio's family office and private equity firm Silver Lake also support the company. However, specifics on G42's US expansion are still shrouded in mystery. Khazna, G42's majority-owned data center firm, has yet to disclose plans for immediate US projects.
"While we're currently concentrating on opportunities across APAC and other priority regions, we're carefully observing developments through G42's expansion in the US and will look to support and grow alongside that initiative when the right moment arrives," explained Hassan Alnaqbi, Khazna's CEO [4].
Amid Trump's punishing trade war, UAE officials have emphasized their commitment to long-term US investments, while stressing their advantageous trade surplus with the US. "UAE investment institutions are likely one of the most significant foreign direct investors into the US economy for the past 20 years," stated Khaldoon al Mubarak, CEO of Mubadala, at a conference in Washington last month [5].
Additional reporting by Tim Bradshaw in London and George Hammond in San Francisco
Insights:
- G42, the UAE's prime AI and tech firm, has incorporated a US entity and has investment backing from U.S. companies like Microsoft, Ray Dalio’s family office, and private equity firm Silver Lake [5].
- Established investments in companies like Cerebras Systems expand G42's AI hardware capabilities [5].
- Subsidiaries are poised to reveal US business plans, focusing on AI applications, cloud computing, and possibly data centers, aiming to leverage the US tech ecosystem [1][5].
- G42's majority-owned data center firm, Khazna, is entertaining US investments as part of its broader infrastructure strategy, which includes data centers worldwide [4].
- G42's expansion aligns with the UAE's ambitious $1.4 trillion investment framework for the US, focusing on AI infrastructure, semiconductors, energy, and manufacturing [1][5].
- G42's US subsidiary, backed by Abu Dhabi's sovereign investor Mubadala and supported by US companies like Microsoft, Ray Dalio’s family office, and private equity firm Silver Lake, plans to make significant investments in AI applications, cloud computing, and data centers in the future.
- The upcoming unveiling of business plans by some G42 subsidiaries will likely reveal their prime focus on leveraging the US tech ecosystem for AI applications, cloud computing, and possibly data centers.
- As part of its broader infrastructure strategy, G42's majority-owned data center firm, Khazna, is considering US investments to expand its data center network worldwide.
- A strong US presence for G42 would facilitate more substantial investments for Abu Dhabi entities, reflecting the UAE's wider embrace of AI and technology as part of their economic diversification policies.
- The UAE's ambitious $1.4 trillion investment framework for the US focuses on sectors such as AI infrastructure, semiconductors, energy, and manufacturing, aligning with G42's expansion plans.
