Cerebras raises $5.5B ahead of Nasdaq debut in landmark IPO

AI Chipmaker Cerebras Systems, a central partner in the UAE’s AI ambitions, has raised $5.5 billion ahead of its listing on the Nasdaq today, in the biggest IPO in the U.S. this year.

The California-based startup, which counts UAE tech investor G42 and Abu Dhabi’s Mohamed bin Zayed University of Artificial Intelligence among its biggest customers, priced its shares at $185 each, valuing the company at about $40 billion.

G42, which is chaired by UAE National Security Advisor Sheikh Tahnoon bin Zayed, bought about 1% of Cerebras for $40 million in 2021, meaning it stands to reap a substantial paper windfall in the IPO.

Earlier this year, Cerebras made a $10 billion deal to supply Sam Altman’s OpenAI with more than 750 megawatts of computing power over three years.

The Daily Circuit: L’imad’s $30B fund with BlackRock + Cerebras reaches Wall St.

In today’s Daily Circuit, we’re reporting on Gulf-backed Cerebras’s $5.5 billion Nasdaq debut, UAE defense contractor EDGE buying control of Italy’s CMD, and Dubai Taxi’s $395 million acquisition of rival National Taxi. Plus, Mubadala chief Khaldoon Al Mubarak, Chairman of Manchester City F.C., visiting its women’s team to open a new $10 million training center. But first, L’imad’s $30 billion partnership with Wall Street and Singapore.

Abu Dhabi’s rapidly expanding L’imad Group and ADNOC oil company are teaming up with BlackRock, the world’s largest asset manager, and Singapore’s Temasek sovereign wealth fund to invest as much as $30 billion in logistics and energy projects.

The four firms issued a statement today saying that funding for future deals across the MENA region and in Central Asia will come from BlackRock’s Global Infrastructure Partners, along with L’imad, Temasek and ADNOC.

The massive combination of capital demonstrates the ambitious agenda of L’imad, the UAE’s newest sovereign fund, which emerged last year when it acquired most of ADQ’s holdings and now manages about $300 billion in assets.

BlackRock CEO Larry Fink cultivated goodwill last month when he visited the UAE in the middle of Iran war and met with President Sheikh Mohamed bin Zayed to discuss strengthening investment partnerships.

L’imad made a splash in December when it joined Saudi Arabia’s Public Investment Fund and the Qatar Investment Authority in backing Paramount Skydance’s $108 billion takeover bid for Warner Bros. Discovery.

Meanwhile, the UAE’s state-owned defense contractor EDGE Group signed an agreement today to acquire a majority stake in Italy’s Costruzioni Motori Diesel, which specializes in developing advanced propulsion systems for road vehicles, ships and aircraft.

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FOOTBALL FEVER

Khaldoon Al Mubarak opens Manchester City Women’s new $13.5 million training center

Khaldoon Al Mubarak, Chairman of Manchester City F.C. and Group CEO of Abu Dhabi’s Mubadala sovereign wealth fund, hailed the development of women’s soccer in the U.K. at the launch of a $13.5 million training center for Manchester City’s women’s team.

Manchester City is owned primarily by the City Football Group, which is controlled by the Abu Dhabi United Group. Sheikh Mansour bin Zayed, the UAE Vice President and owner of Abu Dhabi United, bought the soccer club in 2008, The Circuit’s Jonathan Ferziger reports.

“This new facility marks the next logical step in our long-term commitment to Manchester City Women, and is an important milestone for the club as a whole,” Al Mubarak said on Tuesday.To read the full story, click here.

🎶 Culture Circuit

🎥 On Set: Arab films are making a strong showing at this year’s Cannes Film Festival, which kicked off Tuesday, drawing global stars, filmmakers and investors to the glittering French Riviera. This year’s lineup includes features by Moroccan, Palestinian and Yemeni directors, as well as shorts from Tunisia, Syria, Algeria, Lebanon, Morocco and Sudan, The National reports. Among the standouts is Oscar-winning Egyptian-French filmmaker Arthur Harari’s “The Unknown.” The film, competing in the main competition, follows a photographer who wakes up in the body of an unknown woman.

📷 Photo of the Day

Saudi-Israeli joint venture aims to boost solar power use in Gulf

TEL AVIV, Israel – SolarEdge Technologies, one of Israel’s largest companies trading on the Nasdaq, is forming a joint renewable energy venture with a business group in Saudi Arabia amid White House efforts to broker a normalization pact between the two countries.

The new company created by SolarEdge and Ajlan & Bros Holding will be based in the Saudi capital of Riyadh and work to accelerate the adoption of solar power in the kingdom, the two partners said in a July 31 statement. SolarEdge, an S&P 500 company that maintains headquarters in both Herzliya, Israel, and Milpitas, Calif., produces solar inverters, which manage photovoltaic cells to make renewable energy more efficient. Ajlan is the majority shareholder.

The announcement came more than a year after the Saudi and Israeli companies signed a cooperation agreement that provided little detail of what the alliance would entail. It was one of 13 deals between Saudi and U.S. companies that were announced while U.S. President Joseph Biden visited Saudi Arabia in July 2022.

Zvi Lando, SolarEdge’s Israeli CEO, said in the statement that his company was “honored to partner with Ajlan & Bros. Holding and to support Saudi Arabia’s journey towards Vision 2030” – referring to a document outlining the kingdom’s efforts to wean the economy off oil and develop industries ranging from finance and tourism to sports and entertainment.

“SolarEdge is committed to driving the clean energy transition on a global scale, exemplified by this JV which will provide local enterprises in Saudi Arabia with the support they need to rapidly transition away from fossil fuels to clean solar energy and meet their aggressive renewable energy goals,” Lando said. The statement was released from the company’s California office and did not refer to its Israeli roots.

Israel and Saudi Arabia do not have diplomatic relations and their citizens are generally barred from each other’s territory unless they have second passports issued by other countries. The conditions are similar to those in the United Arab Emirates and Bahrain before the two Gulf states signed the U.S.-brokered Abraham Accords in 2020, establishing formal ties with Israel. Several Israeli companies have managed to operate in Saudi Arabia through subsidiaries registered in other countries.

Biden, who has repeatedly said he would like to facilitate an agreement between Israel and Saudi Arabia that would normalize relations between the two countries, sent senior aides to Riyadh last month to discuss a possible deal. Israeli Prime Minister Benjamin Netanyahu has said a Saudi normalization agreement is one of his greatest diplomatic priorities. Saudi Crown Prince Mohammed bin Salman, the kingdom’s prime minister, has said he would like to establish closer relations, but Israel would have to make significant gestures to the Palestinians before an agreement is reached.

SolarEdge is one of the largest of the close to 90 Israeli companies that trade on Wall Street. Its shares have fallen 38% this year and were last trading at $176.35, giving the company a market value of about $10 billion.

Mobileye files for IPO amid barren Wall Street landscape

While stocks drop ever lower and corporate funding sources remain dry, investors saw some light last week when Mobileye, the Jerusalem-based chipmaker for self-driving vehicles that is owned by Intel Corp., filed for its long-anticipated initial public offering.

When the IPO will take place and how much Mobileye will seek to raise on the Nasdaq remains unanswered. But the company’s filing of its S-1 preliminary prospectus with the SEC late Friday generated rare optimism during a tough year.

“I am thrilled,” Michael Granoff, founder and managing partner of Maniv Mobility, told The Circuit. “Mobileye is the most impactful company that has ever been created in Israel, and its impact may grow manyfold in the years to come,” said Granoff, a veteran automotive technology investor who doesn’t hold an interest in the company.

If Mobileye starts selling shares before the end of 2022 as executives have indicated, it will be one of the biggest IPOs of the year. The IPO market has shrunk amid a 33% slide in the Nasdaq Composite Index since the end of 2021, a steady rise in interest rates and global tensions from the Russia-Ukraine conflict.

According to the filing, the IPO is being led by investment banks Morgan Stanley and Goldman Sachs. Among the 24 financial advisors listed are Citigroup, Barclays, Evercore ISI and RBC Capital Markets.

The document leaves the size and timing of the IPO blank. Intel, which bought Mobileye for about $15.3 billion in 2017, had hoped to raise $50 billion with the IPO and has since trimmed the target to $30 billion, according to Bloomberg. Neither company has confirmed the report. Only two IPOs have raised $1 billion or more on New York exchanges since Jan. 1, compared with 45 in 2021.

Mobileye is one of the leaders in creating software, semiconductor chips, cameras and sensory arrays to enable the development of self-driving vehicles. Chief executives from the world’s largest car companies have made the pilgrimage to Jerusalem to see the company and meet with CEO Amnon Shashua.

In Friday’s filing, Mobileye said it plans to use proceeds from the IPO to pay back debt to Intel, as well as for working capital and general corporate purposes. Other details gleaned from the prospectus are that Intel CEO Pat Gelsinger will serve as chairman of Mobileye and that the board will include Jon Huntsman, the former governor of Utah. Huntsman, who previously served as U.S. ambassador in both Russia and China and was a Republican candidate for president in 2012, serves on the board of Ford Motor Co. The document notes that Mobileye acquired Moovit, a popular app and transportation business, from Intel this year. Intel bought the Israeli company for $900 million in 2020.

Shashua said in a July letter to employees that the IPO was being postponed until markets stabilize. “We still hope that the offering will take place in 2022 and meanwhile the company is prospering on all fronts and the future seems more promising than ever,” he wrote. In last week’s prospectus, the company reported a 21% increase in revenue for the first half of 2022 compared to the same period last year.

Gelsinger said in an interview with Calcalist while visiting Israel in March that Intel was closely following market conditions to determine the timing for the IPO. “The electric car market is heating up and I want Mobileye to be a prominent player there,” Gelsinger told the financial news site. “We are fully invested in Mobileye’s success but I think it will be a greater success after the IPO.”

New registrations for electric vehicles in the U.S. have increased by more than 250% over the past five years. Sales of electric cars in China nearly tripled to 3.3 million last year, about half the global total.

Granoff, whose fund is an investor in Israel’s Otonomo Technologies, which collects data from network-connected vehicles, said the Mobileye IPO will be good for the emerging industry of autonomous vehicles.

“They pioneered concepts that have made vehicles safer and have set the stage for cars that are increasingly automated,” he said.