Abu Dhabi-based AI firm G42 has sold its stakes in several Chinese entities, including ByteDance, the parent company of TikTok.
G42 wants to avoid criticism from the US regarding its connections with Chinese businesses.
The technology investment branch of G42, known as 42XFund, boasts a hefty $10 billion in technology investments, confirmed to the Financial Times its complete withdrawal from investments in China.
42XFund in 2022, originally a collaboration between G42 and the Abu Dhabi Growth Fund (ADG), is a strategic partnership to amplify Abu Dhabi’s influence in the tech sector.
While the fund remained tight-lipped about specific transactions and the total of its Chinese investments, insiders confirmed it involved shares in ByteDance, estimated to be worth around $100 million.
The UAE’s agnostic stance to both the US and China puts them in a fairly unique position to deal with both.
Peng Xiao, G42’s CEO, said in a December interview with the Financial Times that he acknowledges playing both sides isn’t really an option amid geopolitical frictions between the US and China: “In order for us to further our relationship — which we cherish — with our US partners, we simply cannot do much more with [previous] Chinese partners.”
Xiao continued, “The impression we are getting from [the] US government and US partners is, we need to be very cautious… we simply cannot do much more work with Chinese partners.”
G42, under the chairmanship of Sheikh Tahnoon bin Zayed al-Nahyan, the UAE’s influential national security adviser, is involved in a wide array of AI initiatives spanning health, life sciences, geospatial mapping, and generative AI.
The company, supported by substantial investments from the UAE’s sovereign wealth fund Mubadala and the US private equity giant Silver Lake, has collaborated with both US tech giants, including Microsoft and OpenAI, and Chinese tech firms.
G42 is sensitive to its position and eager to appease the US, as it relies on semiconductors from Nvidia.
OpenAI’s Sam Altman has been discussing with Sheikh Tahnoon about starting a new semiconductor venture and later topped headlines as he seeks trillions of dollars of funding for an internationally collaborative chip manufacturing plan.