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G42, a Mubadala-backed artificial intelligence firm, on Thursday launched a $10 billion fund to invest in late-stage technology companies.
The Abu Dhabi-based company said G42 Expansion Fund would operate as a private equity investor targeting a broad spectrum of technologies that promise to shape the global economic landscape in the next decades.
The fund, which is established in strategic partnership with Abu Dhabi Growth Fund (ADG), identifies computing, clean technology and renewables, digital infrastructure, life sciences, healthcare, new materials and fintech, among others, as potential sector for investment.
The fund, which will be managed by a subsidiary of G42, is focused on accelerating the pace of global innovation by investing in late-stage growth companies with disruptive technologies and strong business fundamentals.
Peng Xiao, group CEO at G42 and chairman of the G42 Expansion Fund’s Investment Committee, said the G42 journey to date has been marked by success stories in a wide range of industries, addressing the most complex challenges faced by our customers.
“With the foundation built by our operating businesses and support from our strategic partner ADG, the next era of G42 will be marked by our ability to turbocharge new ventures around the world,” Xiao said in a statement.
In a recent report, Boston Consulting Group said the UAE, about 96 per cent of whose tech workforce is composed of immigrants, exemplifies the benefits of a well-planned, comprehensive strategy for developing a tech hub that deploys both short- and long-term levers.
“The UAE successfully attracted leading technology companies by cutting its corporate tax rate to zero. Smaller tech companies followed with UAE operations. The emirate also launched an initiative to attract talent with the skills needed by industries targeted by the government, such as agriculture technology,” BCG report said.
Dubai also introduced various measures to attract investment in the technology sector and promote digital economy. Dubai Future District, a new space dedicated to the development of the future economy, as well as an Dh1 billion fund formed to support new economy companies who can power Dubai’s future growth.
Investment in high growth region
The fund will operate as a private equity investor, with a significant share of investment earmarked for high growth regions. In addition to providing investment support, G42 will leverage its operational assets and ecosystem of operating companies to accelerate value creation across the G42 Expansion Fund’s portfolio of investments.
“With the G42 Expansion Fund, we aim to accelerate our global impact not only through the deployment of capital, but also by providing unique access to our networks, management, and operational assets to our portfolio companies,” Xiao said.
“We are eager to engage with trailblazing entrepreneurs who share our core values and growth ambitions, and we are excited to be partnering with ADG to further cement Abu Dhabi as a global hub for innovation and progress,” he said.
High-impact technology solutions
G42 develops high-impact technology solutions to solve the world’s most complex problems through a robust business portfolio including Bayanat, G42 Healthcare, G42 Smart Nation, G42 Cloud, Injazat, Khazna, Presight, and more. It also partners with a growing global network of leading international organisations in its mission to democratize access to cutting-edge technology for every market in the world.
Khalifa Al Suwaidi, ADG chief executive and member of the G42 Expansion Fund’s Investment Committee, said welcomed the initiative and said it is an excellent fit with the company’s investment strategy.
“By supporting both innovation and strong management teams within well-organized businesses, the G42 Expansion Fund is an excellent fit with our investment strategy. We look forward to partnering with G42 as we continue to build on our strategy of partnering with high-quality fund managers that can deliver top-quartile financial returns over the long-term,” Al Suwaidi said.
Important milestone for tech ecosystem
Egon Durban, co-CEO and managing partner of Silver Lake and board member of G42, said the launch of the G42 Expansion Fund is an important milestone in the growth of the UAE’s technology ecosystem as a pioneering driver of innovation and entrepreneurship globally.
“It underscores G42’s position as a highly respected technology company, committed to leadership in developing and delivering AI and digital transformation solutions that have a positive impact in helping businesses and governments responsibly and sustainably address their most pressing challenges and embrace their most compelling opportunities,” Durban said.
