Emirati defense giant EDGE Group teams with Spain’s Indra to dive into advanced radar market

BEIRUT — With a new agreement with Spanish firm Indra, Emirati defense giant EDGE Group aims to enter what a company spokesperson called the “very strategic” advanced radar market — a first for a Gulf firm.

EDGE and Indra announced a new joint venture (JV) late last week, which will produce radars in Abu Dhabi and, in Indra’s words, provide “access to a non-NATO, non-EU pipeline of orders for approximately 300 advanced radar solutions.” That pipeline, the EDGE spokesperson said, is estimated to be worth some €2 billion ($2.2 billion).

The spokesperson for EDGE, which is a conglomerate of more than 25 companies, said advanced radars represent a “very strategic, fundamental capability for the technology systems, as naval, air defence etc. Only few companies have the technology in advanced stage as Indra.”

EDGE hopes to start production in 18 months, the spokesperson said. The signing ceremony for a memorandum of understanding for the venture took place at the Spanish Ministry of Defense in Madrid.

Under the agreement, EDGE Group will own 50 percent of the JV while the other 50 percent is owned by Indra. The Emirati firm will contribute through its “commercial capabilities, building blocks technology and financing,” while the Spanish firm “will transfer the technology, and the JV will create new IPs and radar systems,” the spokesperson said. The JV will produce six main products along with variants.

Leonardo Jacopo Maria Mazzucco, an analyst at Gulf State Analytics, said the agreement speaks “volumes about EDGE’s resolve to develop sound domestic production capabilities of next-gen radar systems in the short term and to position itself as a competitive radar production hub regionally in the long run.”

“The fact that the JV agreement refers to an already existing pipeline of orders for almost 300 sophisticated radar systems bodes well for a smooth operationalization of the deal, [but] it is also important to recall that the transfer of critical technology from Indra to the newborn JV and the integration of engineering, commercial, and manufacturing capabilities between Indra and EDGE will need time to be properly executed, ultimately having an impact on the JV’s capacity to deliver on its current backlog of orders,” Mazzucco said.

Mazzucco added that with the Emirati firm’s previous joint ventures with other tech and defense companies “displaying paramount attention for quick and tangible results, it is reasonable to expect that the Emirati conglomerate will aim to ensure that the partnership with Indra also yields fruit.”

For Indra, company chairman Marc Murtra said the agreement “can create one of the world’s leading players in the field of radar technology and is a step forward in Indra’s international expansion strategy. With strategic initiatives such as this, we are making decisive steps in key vectors of our Strategic vision 2024-2026: technological leadership, international growth and partnerships building.”

The initial announcement highlighted that the JV will aim at expansion “by targeting untapped and fragmented non-NATO markets” including, according to the EDGE spokesperson, customers in the UAE, Africa, Latin America and South East Asia.

EDGE has been heavily targeting the Latin American market especially, including opening its first international office in Brazil.

Mazzucco said that the JV highlights EDGE’s determination “to further consolidate its standing as a rising Middle Eastern tech and defense company and steadily expand its domestic production capabilities to unexplored, yet critical, domains.”

“The setup of a JV specifically meant for developing and manufacturing next-gen radar systems fits neatly into EDGE’s ambition to mature all-round production capabilities,” he concluded.

Until production facilities are set up in the United Arab Emirates, the EDGE spokesperson said the JV will use facilities in Spain.