Israel and UAE Collaborate on AI Tech; New Israeli Airline Takes Flight Plans Forward

In a groundbreaking move for defense industry collaboration, Israel’s Thirdeye Systems has entered into a joint venture with the UAE's Edge Group. Thirdeye, a leader in electro-optical recognition systems integrated with AI for drones, announced today that the agreement will see Edge invest $10 million for a 30% stake in the Israeli firm, making it Thirdeye’s largest shareholder. The deal, which is contingent on approval by Israel's Ministry of Defense, also includes plans to establish a joint company, with Edge taking a majority stake of 51%.

The joint venture will focus on developing, commercializing, and marketing cutting-edge electro-optical identification systems, particularly targeting select global markets. The collaboration between Israel and the UAE, two regional powerhouses, signifies the growing ties between the two countries, particularly in high-tech and defense industries following the Abraham Accords.

Thirdeye's market cap stands at $23.3 million, with the deal reflecting a valuation of $31.1 million, a 25% premium over its current market value. However, investors should note that Thirdeye’s stock is highly volatile, having surged by 300% after the outbreak of war, only to see a 50% decline since May 2024.

In another development within Israel's aviation industry, Kavei Hufsha (Holiday Lines), a group that already owns Greek airline Blue Bird and Cypriot airline TUS, is planning to establish a new Israeli airline. The new venture will focus on offering short-haul flights to destinations within four to five hours from Israel.

While the process of setting up a new airline is complex and lengthy, Kavei Hufsha is optimistic about the potential for the new carrier to tap into regional travel, particularly as the Abraham Accords expand and Israel potentially gains more access to new destinations. The airline will focus on routes such as Georgia and Dubai, which are currently out of reach for their existing European subsidiaries due to restrictions in bilateral aviation agreements.

These restrictions prevent European airlines from operating flights from Israel to non-European destinations, a limitation designed to protect local Israeli carriers. However, the possible expansion of the Abraham Accords may offer new opportunities for Israeli airlines to operate routes to countries like Saudi Arabia, further expanding the country's global aviation footprint.

Looking Ahead

The joint venture between Thirdeye Systems and Edge Group marks an important step forward in strengthening ties between Israel and the UAE, particularly in the high-tech and defense sectors. Meanwhile, Kavei Hufsha's move to launch a new Israeli airline highlights the country's growing influence in regional aviation, further fueled by the normalization of relations with several Arab nations under the Abraham Accords.