BEIRUT — UAE’s defense conglomerate EDGE Group has taken over Abu Dhabi-based Oryxlabs, in its first-ever acquisition in the cybersecurity realm. The move, experts say, is part of a broader effort by Emirati champion EDGE to both focus on unconventional technologies and boost the Gulf state’s capabilities for exports, regionally and internationally.
On June 6th, Edge announced the acquisition of the three-year old company, in what the conglomerate described in a statement as giving “EDGE the opportunity to expand its portfolio and provides it with advanced solutions to solve critical pain points in cybersecurity, both locally and internationally.”
In its electronic warfare and cyber technologies cluster, EDGE has three entities: Beacon Red, which specializes in security training; Katim for secure communications and ruggedized mobile platforms for armed forces; and Sig4l for electronic warfare. But until now, EDGE lacked a pure cybersecurity capability. It would appear Oryxlabs, whose expertise includes data science, AI, security research, and big data, would fill that gap.
“EDGE Group’s rapid growth and increasing emphasis on creating sovereign capabilities necessitates pursuing opportunities that enhance our capabilities and expand our offerings. Adding OryxLabs into the Group is a logical step, enabling us to elevate our portfolio of advanced technology solutions,” said Mansour AlMulla, Managing Director and CEO of EDGE in a statement. “Together, we are well-positioned to navigate the evolving landscape of cybersecurity and offer unparalleled cybersecurity solutions.”
EDGE Group has grown rapidly, largely through aggressive M&A activity. In just the last calendar year it bought a majority stake in Estonian firm Milrem Robotics and took over Katim, a local secure communications firm that was rebranded from its previous name of Dark Matter.
“EDGE was supposed to be developed as a key hub for innovation in the defense and security sector in Abu Dhabi. It’s also a hub and an incubator for new technology in particular, not just in the field of conventional military capabilities,” said Andreas Krieg, senior lecturer at King’s College London, and CEO of MENA analytica, a London-based strategic risk consultancy firm focusing on the wider Middle East region.
He told Breaking Defense that it’s not surprising the UAE is pushing into the cybersecurity sector, pointing out that acquiring a local company also falls into the overall pattern of centralization of control over the security and defense industry in the country. That is particularly true the government of Abu Dhabi, of which EDGE is a wholly owned entity.
“The firm is a strategic tool for the government to kind of centralize innovation and funding, and build a centralized hub for procurement, as well as attracting talent and attracting new technology,” Krieg said.
Ryan Bohl, a senior Middle East and North Africa analyst at the RANE Network, told Breaking Defense that the UAE is in need of stronger cybersecurity capabilities.
“EDGE’s acquisition of cybersecurity aims to build out the UAE’s cyber resilience in an era of increased criminal and state-sponsored hacking,” Bohl said. “The UAE in particular has long been a target for both, given the UAE’s limited legal reach to target overseas criminal groups and its limited ability to retaliate and deter state-backed hacking and espionage. The UAE overall is in a position where it must learn to defend itself, both through better technology and better training, rather than deter such adversaries.”
He added that the best possible explanation as to why EDGE went with a local firm is that OryxLabs both helps meet their overall goal of nationalizing the country’s defense sector while also providing the technology EDGE believes will better secure the UAE.
“It’s not clear what OrxyLabs’ track record is at the moment, but [it’s] certain EDGE believes that it can deliver on its goals,” Bohl concluded.
Overall, there is an expectation that EDGE will continue to look for future acquisitions, in order to meet its overall targets.
“UAE wants to position itself as a leader in this field, regionally, but potentially even globally with Edge. There’s quite an ambition to build something that is potentially leading beyond the shores of the Gulf and beyond the Middle East to be a leader an incubator for innovation in this field that can compete with other conglomerates and edge obviously has over the last couple of years since 2019 grown into this large hub for investments in the defense industry and kind of allows us to deal with the government not only retain full control over the security and defense sector but potentially also use this as a tool of influence globally,” Krieg concluded.