UAE telecommunications company Etisalat (e&) has signed a binding agreement with South Korea's Bespin Global, a multi-cloud solution provider, to form a joint venture (JV) with an initial capital of $10 million. 

The JV, to be called Bespin Global MEA, will be 65% owned by e& enterprise and 35% by Bespin Global, the telecoms company said in a disclosure to the Abu Dhabi Securities Exchange (ADX) on Friday. The contributions to the capital will be on a pro-rata basis. 

Under the agreement, the UAE telecom company can potentially unlock further collaboration with existing Bespin Global’s shareholders by making a primary investment of $60 million in Bespin Global in exchange for a stake of about 10%. 

In addition, e& has the option to invest another $60 million at the same valuation within a period of 18 months from completion of the transaction. Also, e& is committed to provide the JV an additional funding of up to $40 million, in the form of shareholder loans, to finance the growth of the business. 

The investments will be paid in cash, e& said. 

Upon completion of the transaction, the JV will be consolidated into e&’s financials. 

It will offer public cloud managed and professional services in the Middle East, Turkey, Africa and Pakistan (METAP).  

The move to form the JV is in line with the company’s "strategic ambition of scaling up the e& enterprise vertical and enhancing its digital capabilities," according to the statement. 

Earlier this week, Etisalat increased its stake in Britain’s Vodafone Group to 11% of the UK mobile phone company. 

(Writing by Brinda Darasha; editing by Cleofe Maceda)