Abu Dhabi AI group G42 sells its China stakes to appease US

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Abu Dhabi artificial intelligence group G42 has sold its stakes in Chinese companies including TikTok owner ByteDance, as the state-backed group seeks to reassure US partners by cutting ties with China.

42XFund, the $10bn technology investment arm of G42, told the Financial Times that it had “divested from all its investments in China”. The fund did not comment on individual deals or respond to questions about the overall size of its investment in China.

However, two people with knowledge of the matter said the sell-off included shares in Beijing-based ByteDance. G42’s stake in the TikTok owner was worth an estimated $100mn, according to the data provider PitchBook.

The United Arab Emirates, led by G42, is pressing to become a global leader in AI, an effort that has thrust it into the centre of geopolitical jostling between the US and China over the technology.

Chief executive Peng Xiao told the FT in December that G42 “cannot work with both sides” and was severing links with Chinese hardware suppliers, including Huawei.

“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,” added Xiao, who was born in China, studied in the US and is now a UAE citizen.

G42, which is chaired by the UAE’s powerful national security adviser Sheikh Tahnoon bin Zayed al-Nahyan, is developing a range of AI projects, from health and life sciences to mapping and a large language model.

Backed by investors including the UAE sovereign wealth fund Mubadala and US private equity firm Silver Lake, G42 had also been working with US partners such as Microsoft and OpenAI as well as Chinese technology companies.

But the Abu Dhabi-based group, which relies on semiconductors made by US chipmaker Nvidia, has scrambled to allay fears that companies linked to the…