Lenovo’s Strategic Partnership with Alat: Accelerating Global Transformation and Expanding in the Middle East and Africa
In a significant move aimed at bolstering its global presence and expanding its manufacturing capabilities, Lenovo Group Limited has completed a strategic collaboration with Alat, a company backed by the Public Investment Fund (PIF) of Saudi Arabia. This collaboration involves a substantial investment of $2 billion, facilitated through three-year zero-coupon convertible bonds, which marks a pivotal moment in Lenovo’s ongoing transformation journey. Originally announced in May 2024, this collaboration has now received all necessary shareholder and regulatory approvals, paving the way for Lenovo to enhance its global footprint and diversify its manufacturing operations.
Expanding Global Reach and Manufacturing Capabilities
This strategic partnership is set to accelerate Lenovo’s transformation by strengthening its global presence and diversifying its manufacturing footprint. Lenovo aims to leverage this collaboration to capture significant growth opportunities in the Middle East and Africa (MEA) region. By bringing its world-class supply chain, technology, and manufacturing capabilities to Saudi Arabia, Lenovo plans to support the creation of thousands of new jobs in the region. This initiative aligns with Saudi Arabia’s Vision 2030, which focuses on economic diversification, industrial development, innovation, and job creation.
As part of this collaboration, Lenovo will establish a regional headquarters in Riyadh, Saudi Arabia, which will serve as a hub for its operations in the MEA region and beyond. Additionally, Lenovo will construct a sustainable manufacturing facility in the Kingdom, which will focus on producing millions of PCs and servers annually. These products will be developed by local research and development teams and will carry the “Saudi Made” label. The manufacturing facility is expected to commence production by 2026 and will join Lenovo’s extensive network of over 30 manufacturing sites worldwide, which are strategically located in countries such as Argentina, Brazil, China, Germany, Hungary, India, Japan, Mexico, and the USA.
Leveraging Local Insights and Enhancing Retail Presence
In addition to manufacturing, Lenovo and Alat have entered into a business development partnership that leverages Alat’s extensive relationships and insights into the local market. This partnership will enable Lenovo to further expand its investments in research and development, marketing, and strategic partnerships in both Saudi Arabia and the broader MEA region. The regional headquarters will also include flagship retail spaces, enhancing Lenovo’s presence in the Kingdom’s retail landscape.
Statements from Leadership
Yuanqing Yang, Chairman and CEO of Lenovo, expressed his enthusiasm about the collaboration, stating, “Through this powerful strategic collaboration and investment, Lenovo will have significant resources and financial flexibility to further accelerate our transformation and grow our business by capitalizing on the incredible growth momentum in KSA and the wider MEA region. We are excited to have Alat as our long-term strategic partner and are confident that our world-class supply chain, technology, and manufacturing capabilities will be a benefit to KSA as it drives its Vision 2030 goals of economic diversification, industrial development, innovation, and job creation.”
Amit Midha, CEO at Alat, highlighted the significance of the partnership, saying, “We are incredibly proud to become a strategic investor in Lenovo and partner with them on their continued journey as a leading global technology company. With the establishment of a regional headquarters in Riyadh and a world-class manufacturing hub, powered by clean energy, in the Kingdom of Saudi Arabia, we expect the Lenovo team to further their potential across the MEA region.”
Financial Developments and Future Growth
When the strategic collaboration with Alat was announced in May 2024, Lenovo also unveiled its plans for a three-year $1.15 billion Warrants Issuance. This initiative aims to raise additional funds to support future growth and broaden Lenovo’s capital base. The Warrants have been fully subscribed, including a notable 43% subscribed by Lenovo’s leadership, demonstrating confidence in Lenovo’s transformation efforts and its position as a global market leader with strong growth momentum.
Advisory Support for the Transaction
The completion of this strategic collaboration was supported by financial advisors and legal experts. Citi and Cleary Gottlieb Steen & Hamilton (Hong Kong) advised Lenovo, while Morgan Stanley and Latham & Watkins provided advisory services to Alat.
About Lenovo
Lenovo is a global technology powerhouse with a revenue of $57 billion, serving millions of customers in 180 markets worldwide. Ranked #248 in the Fortune Global 500, Lenovo is committed to delivering Smarter Technology for All. The company has established itself as the world’s largest PC manufacturer, offering a comprehensive portfolio of AI-enabled, AI-ready, and AI-optimized devices, including PCs, workstations, smartphones, and tablets. Lenovo also provides infrastructure solutions such as servers, storage, edge computing, high-performance computing, and software-defined infrastructure, along with software, solutions, and services. Lenovo’s continued investment in innovation aims to create a more equitable, trustworthy, and smarter future for everyone, everywhere. The company is listed on the Hong Kong stock exchange under Lenovo Group Limited (HKSE: 992) (ADR: LNVGY).
About Alat
Alat is a transformative company focused on revolutionizing global industries, particularly in electronics and industrial sectors. By establishing a world-class manufacturing hub in Saudi Arabia powered by clean energy, Alat aims to contribute to a better tomorrow. The company is committed to delivering sustainable manufacturing solutions to help global companies reduce emissions and achieve carbon neutrality. As a PIF-backed company, Alat plays a crucial role in advancing Saudi Arabia’s Vision 2030 goals, which include economic diversification, industrial development, innovation, and job creation.
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