Dubai Airshow

"Edge" Consolidates 25 UAE Defense Companies

 - November 17, 2019, 4:35 AM
Faisal Al Bannai, newly appointed CEO of UAE advanced technology defense coglomerate, Edge (Photo: Peter Shaw-Smith)

The UAE government launched advanced technology conglomerate, Edge, earlier this month, to oversee the consolidation of more than 25 innovative national security companies, designed to boost the UAE’s defense credentials, and also appointed a seasoned technology entrepreneur to lead the concern.

Although details of companies involved are sparse, the UAE is keen to consolidate defense entities that were formerly subsidiaries of the Emirates Defence Industries Company (EDIC), namely Emirates Advanced Investments Group (EAIG), Tawazun Holding, and other independent organizations.  

“Faisal Al Bannai has been [selected] to lead Edge (Chalet A14-16), based on his start-up background and proven track record in leveraging emerging technologies to expand business opportunities at home and abroad,” an official press release said. The entrepreneur set up retail mobile phone chain Axiom Telecom, today worth $2 billion, in 1997, and in 2015, established UAE-based cyber-security consultancy Darkmatter.

“Edge will invest extensively across R&D, working closely with front-line operators to design and deploy practical solutions that address real-world challenges,” Al Bannai said. “The solution to address hybrid warfare lies at the convergence of innovations from the commercial world and the military industry. Established with a core mandate to disrupt an antiquated military industry generally stifled by red tape, Edge is set to bring products to market faster and at more cost-effective price points.”

The UAE is known to be a trendsetter in the Arab world in several technological fields and is also keen to buy in international expertise. “We are invested in managing the uncertainty that technology brings by adapting our focus and capabilities toward a sustainable defense and security industry,” Tareq Al Hosani, CEO of UAE defense catalyst, Tawazun Economic Council, said. “Edge will help us transform our domestic capabilities while growing our engagements on defense and security exports.”

Al Bannai said the constituents of the new group had a total of around 12,000 employees, revenues of $5 billion, and would be split into five core clusters: platforms and systems, missiles and weapons, cyber defense, electronic warfare and intelligence, and mission support.

The announcement likely signifies the UAE government’s wish to improve cost-effectiveness in defense procurement. In light of intensification of regional threats, U.S.-based Deloitte Consulting LLP said in December 2018 that although defense expenditure in the UAE and Saudi Arabia had slowed recently, seven out of the top 10 countries with the highest military expenditure as a percentage of GDP worldwide were in the Middle East: Oman, Saudi Arabia, Kuwait, Jordan, Israel, Lebanon, and Bahrain.

Asked by AIN if the entity had been set up due to the worsening security situation in the Middle East, Al Bannai said: “Not really. I think the reason for this announcement is a very clear vision from the country [that] this is the right time to put all of these entities under one roof, to have a unified strategy and [be] in a position to dramatically accelerate our capability. It relates to the country's overall strategy of becoming a strong technological player and setting the foundation for that to happen.”