Microsoft is set to invest $1.5 billion in the UAE-based tech firm G42 for a minority stake and will join its board of directors, according to an official announcement.

The Abu Dhabi-based artificial intelligence (AI) giant G42 will also partner with Microsoft to support the establishment of a $1 billion fund for developers to boost AI skills in the UAE and the broader region.

In an update on its official blog, the US-based Microsoft said the expansion of partnership between the two companies aims to deliver advanced AI solutions with Microsoft Azure across various industries and markets across the Middle East, Central Asia, and Africa.

According to the blog, Brad Smith, Microsoft Vice Chair and President, will join G42’s board of directors, with the deal “significantly advancing G42’s strategy of delivering generative AI and next-generation infrastructure and services across financial services, healthcare, energy, government, and education,” it said.

The companies said the commercial partnership is backed by assurances to the US and UAE governments through a binding agreement to ensure the “responsible development and deployment of AI.”

Abu Dhabi’s Sheikh Tahnoon bin Zayed Al Nahyan, Chairman of G42, said in a statement: “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. This partnership is a testament to the shared values and aspirations for progress, fostering greater cooperation and synergy globally.” 

Tech giant Microsoft also announced that Jais, G42’s Arabic Large Language Model (LLM), will be available in the Azure AI Model Catalog.

The collaboration between G42 and Microsoft has expanded following a joint plan announced in April 2023 to develop AI solutions tailored for the public sector and industry. In September 2023, the companies entered into an agreement to introduce sovereign cloud offerings and collaborate on unlocking the potential of advanced AI capabilities on the Azure public cloud platform.

G42 has been eyeing expansion in the Africa as well, with the company’s Chief Technology Officer Kiril Evtimov revealing to Zawya in February it was looking to develop capabilities in financial services solutions, government services and the SME landscape on the continent in 2024.

(Reporting by Bindu Rai, editing by Brinda Darasha)