Inside Lenovo's US$2bn Deal With Saudi Manufacturer Alat
World-famous technology manufacturer Lenovo has announced a new collaboration with with Saudi Arabia's Alat, a company with a sharp focus on sustainable manufacturing.
The agreement, originally announced in May 2024, promises to accelerate Lenovo's transformation while bolstering its presence in the Middle East and Africa (MEA).
In total, the partnership will see Lenovo invest US$2bn in Alat, through the use of zero-coupon convertible bonds.
The deal comes at a time when both companies are aiming to capitalise on the Saudi Vision 2030 initiative, which emphasises economic diversification and sustainable development, seen through a heightened focus on tourism, sport and environmentalism.
Manufacturing, with a sustainable focus
Central to this partnership is the establishment of a sustainable manufacturing facility in Riyadh, Saudi Arabia, which is expected to begin operations by 2026.
This facility will produce millions of personal computers and servers annually and employ local research and development teams to create fully Saudi-made products.
The factory's reliance on clean energy aligns with Saudi Vision 2030, a national plan aimed at fostering innovation, industrial development, and environmental responsibility.
“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,” says Amit Midha, CEO of Alat.
This addition will expand Lenovo's global manufacturing footprint, which already spans more than 30 locations, including Argentina, Germany and India. By integrating local R&D efforts, Lenovo aims to provide region-specific solutions that address the unique needs of MEA customers.
Job creation and economic diversification
The partnership is set to create thousands of new jobs in Saudi Arabia, supporting the country's economic diversification goals.
Lenovo's Chairman and CEO, Yuanqing Yang, understands the impacts this relationship could have.
“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," he says.
In addition to job creation, Lenovo plans to establish a regional headquarters in Riyadh to oversee its operations across the MEA region.
The headquarters will also include flagship retail spaces and expanded investments in marketing, R&D, and strategic partnerships.
Exploring the opportunities of the MEA region
The MEA region represents a rapidly growing market for technology, driven by increased digital transformation and infrastructure development.
By collaborating with Alat, Lenovo aims to strengthen its position in this burgeoning market. Alat's deep understanding of the region and its extensive local networks provide Lenovo with an invaluable advantage.
Ken Wong, President of Lenovo, highlighted the importance of regional collaboration: “This partnership is an opportunity to support innovation, create meaningful jobs, and deliver truly localised solutions – all while contributing to the goals of Saudi Vision 2030.”
A long-term investment in growth
In conjunction with the US$2bn investment, Lenovo announced a three-year, US$1.15bn Warrants Issuance to raise additional funds.
Fully subscribed, including 43% taken up by Lenovo's leadership, the issue reflects strong confidence in the company's ongoing transformation and global market leadership.
The financial structure of the deal, supported by advisors including Citi and Cleary Gottlieb Steen & Hamilton for Lenovo and Morgan Stanley and Latham & Watkins for Alat, demonstrates a robust framework aimed at fostering sustainable growth in the 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.
An expansion of operations
Lenovo's manufacturing facility and regional headquarters represent significant steps toward aligning the company's operations with global sustainability goals.
The collaboration with Alat not only provides financial resources but also strengthens Lenovo's ability to innovate in clean energy-powered manufacturing.
“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 capitalising on the incredible growth momentum in KSA and the wider MEA region,” Yang says.
Make sure you check out the latest industry news and insights at ClimateTech Digital and be part of the conversation at our global conference series, Sustainability LIVE .
Discover all our upcoming events and secure your tickets today. Subscribe to the ClimateTech Digital newsletter.
ClimateTech Digital is a BizClik brand