United Arab Emirates-based Geospatial data and analytics provider Bayanat AI and Al Yah Satellite Communications Company (Yahsat) have agreed to merge operations. 

The proposed merger aims to create a leading MENA region space technology company powered by artificial intelligence (AI).

Both Bayanat AI and Yahsat are headquartered in Abu Dhabi and listed on the Abu Dhabi Stock Exchange. 

Based on the closing share prices of both companies as of 18 December 2023, the business combination is expected to create an entity with an implied market capitalisation exceeding Dh15bn ($4.1bn).

As per the announcement, the combined company will be vertically integrated and well-equipped to seize regional and international opportunities across geospatial and mobility solutions, satellite communications, and business intelligence. 

With a robust financial foundation, advanced AI-powered technological capabilities, and a diverse product portfolio, the merger is also expected to catalyse transformative technologies delivering space-based services.

The deal will be structured as a share swap, with Bayanat remaining as the legal entity post-merger. 

Bayanat shareholders are set to own approximately 54%, while Yahsat shareholders will hold around 46% of the new entity. 

Key stakeholders such as Group 42, Mubadala Investment Company, and International Holding Company will own significant stakes, approximately 42%, 29%, and 8%, respectively, in the new entity.

Bayanat chairman Tareq Al Hosani said: “This merger will unite two leading home-grown companies to create the MENA region’s first AI-powered space technology company. 

“Leveraging our complementary assets, capabilities and ambitions will allow us to expand across the space value chain and offer an unparalleled service to our combined customer base.”

 Yahsat chairman Musabbeh Al Kaabi said: “The enlarged entity will benefit from accelerated growth potential as a player of scale with enhanced competitive advantage. 

“This growth will be driven by our access to high-growth markets via cutting-edge technologies and an increased base of local and global customers, in addition to strong financials that allow us to pursue more ambitious growth opportunities.”

The merger is subject to several conditions, including approvals from regulatory authorities, as well as shareholders.

Until the merger’s completion, expected in the second half of 2024, Bayanat and Yahsat will maintain independent operations.