Microsoft is investing $1.5 billion in G42 (also known as Group42), a UAE-based AI holding company, as part of a strategic deal, the two firms announced today. Started in 2018, G42 through its subsidiaries focuses on AI development across different industries including government, healthcare, energy, finance, aviation, and hospitality.
The firm is chaired by UAE’s national security advisor Tahnoun bin Zayed Al Nahyan. Its previous investors include Mubadala and US-based Silver Lake.
G42 launched an Arabic large language model Jais in August last year, which it claims outperforms existing Arabic models by a ‘sizable’ margin, “It is also competitive with English models of similar size despite being trained on significantly less English data,” a statement by G42 noted on the launch of the Arabic model.
G42 previously had strong ties to China as it relied on Chinese hardware suppliers for the compute but the company severed those ties to be able to access US-made chips. Its CEO Peng Xiao at the time said, “For better or worse, as a commercial company, we are in a position where we have to make a choice. We cannot work with both sides. We can’t.”
Answering a question by Financial Times on whether the Microsoft deal was a prize for cutting ties with China, the company’s CEO said, “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.”
As a result of the deal with Microsoft, G42 will run its applications and services on Microsoft Azure. The two companies will also collaborate on deploying various AI and digital infrastructure initiatives across countries in the Middle East, Central Asia, and Africa, they said in a joint statement.
The partnership also aims to support the development of AI talent pool in the United Arab Emirates with the investment of $1 billion in a development fund for developers.
Sheikh Tahnoon bin Zayed Al Nahyan, Chairman of G42, commenting on the deal, said, “Microsoft’s investment in G42 marks a pivotal moment in our company’s journey of growth and innovation, signifying a strategic alignment of vision and execution between the two organizations.”
Brad Smith, Microsoft Vice Chair and President, said, “Our two companies will work together not only in the UAE, but to bring AI and digital infrastructure and services to underserved nations. 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.”
Peng Xiao, the Chief Executive Officer of G42, said, “Through Microsoft’s strategic investment, we are advancing our mission to deliver cutting-edge AI technologies at scale. This partnership significantly enhances our international market presence, combining G42’s unique AI capabilities with Microsoft’s robust global infrastructure.”
Samer Abu-Ltaif, Microsoft Corporate Vice President and President, Central and Eastern Europe, Middle East and Africa, said, “Our investment in G42 stands as a testament to the thriving and dynamic tech landscape in the UAE and the broader region. With G42, we will introduce cutting-edge technologies that will empower countries and markets to advance their digital agendas by harnessing the power of Cloud and AI.”
