South Korea’s leading cybersecurity company, AhnLab, established a joint venture with Saudi Arabia’s Saudi Information Technology Company (SITE), a cybersecurity and cloud service company fully backed by Saudi’s Public Investment Fund (PIF), to expand its presence in the Middle East. AhnLab will hold a 25% stake in the joint venture, and SITE will own the remaining 75%. The goal is to launch the joint venture within the first half of this year.
Additionally, SITE Ventures, a wholly owned subsidiary of SITE, will acquire a 10% stake in AhnLab for an estimated $55 million (74.4 billion won). After the payment is completed by the end of June this year, SITE Ventures will become the company’s second-largest shareholder after Ahn Cheol-soo, the founder of AhnLab.
“We plan to expand our cybersecurity and cloud solution business into the Middle East and North Africa with the establishment of this joint venture,” AhnLab CEO Kang Sukkyoon said after both companies signed the partnership on April 1.
Partnerships between so-called “oil money” nations, such as Saudi Arabia and UAE, and South Korean tech companies have blossomed in the past few years. These Middle Eastern countries, traditionally heavily reliant on the oil sector, are diversifying into high-tech fields, finding common ground with Korean tech companies looking for new markets and investment opportunities. Korean tech giants such as Naver and Nexon, alongside several startups, have secured investments from these oil-rich nations to broaden their market reach.
Naver has been particularly active in the region. Naver announced that the company recently signed a memorandum of understanding (MOU) with Aramco Digital, a subsidiary of Saudi Arabia’s state-owned oil company Aramco, to foster digital innovation in the Middle East and North Africa. The partnership focuses on developing artificial intelligence (AI) models based on the Arabic large-scale language model (LLM).
Over the past year, Naver inked over ten MOUs with Middle Eastern and domestic companies to expand its business in the region. Some of these efforts have yielded tangible results. Last October, Naver secured a $100 million contract from the Saudi government for a ‘digital twin’ platform project, which aims to digitally replicate five Saudi cities, including Riyadh, to support urban planning initiatives.
“We aim to lead the digital transformation of Saudi Arabia, including building a government administrative service similar to South Korea’s Government 24 and a project to map the entire country digitally,” said a Naver representative.
Korea’s gaming sector is also tapping into the Middle East, with the UAE as a strategic hub. Nexon recently set up a company called “Nexface” in the UAE to promote its blockchain gaming ventures utilizing non-fungible token (NFT) technology. Nexon said the move aims to boost the company’s blockchain-based games, Nexface and MapleStory Universe. Korean blockchain gaming companies WeMade and Neowiz Holdings have also established subsidiaries in the UAE.
