Aramco Digital, the wholly owned technology arm of Saudi Aramco, plans to invest $1 billion in Mavenir, a US-based telecom service provider, as part of its strategic push into the telecommunications sector.
The Saudi investment is expected to secure a “significant minority” stake in Mavenir, valuing the US company at $3 billion, sources familiar with the plan told Reuters.
The funding will support Mavenir’s advancements in 5G technology and preparations for the 6G network rollout in the latter half of the decade. However, the deal is not yet finalised, the report said.
Mavenir is collaborating with New York-headquartered investment bank Evercore on discussions with Aramco Digital.
The Texas-based company specialises in technology which helps telecom operators reduce costs by enabling mobile networks to leverage cloud-based software. To date, Mavenir has raised $800 million through various funding rounds.
Additionally, Aramco Digital plans to allocate another $200 million as part of a joint venture with the US company to fund regional technology development, the report said.
In October, Wa’ed Ventures, the $500 million venture capital fund owned by Aramco, announced plans to invest $100 million in early-stage artificial intelligence (AI) startups.
Saudi Arabia has dedicated efforts to attract startups across sectors – it previously offered $888 million to companies in the digital payments, gaming and artificial intelligence fields, and its venture capital funding in e-commerce alone hit $428 million in 2023.