VisionWave, a company that makes drones and autonomous ground vehicles, is planning a data center project in Israel.

The Nasdaq-listed company has entered into a term sheet with Lucky Whale Production Limited proposing to establish a joint venture to develop, own, and operate a proposed Tier IV data center project in Beth Shemesh, Israel.

Lucky Whale Production Limited is a Hong Kong-incorporated project sponsor active in real estate project management.

Under the proposals, VisionWave would own 68 percent of the JV, which in turn would own 75 percent of a special-purpose project company that would hold the land, building permits, and related rights for the data center, with the remaining 25 percent retained by the current landowner. VisionWave would effectively own 51 percent of the project.

As part of the deal, VisionWave would issue shares worth $40 million to the unnamed landowner.

The underground facility, currently undergoing planning, would reportedly be located adjacent to the Galilee Medical Center.

Phase I of the data center campus would comprise approximately 15,000 square meters (161460 sq ft) across ten data halls, targeting 10.5MW of IT load.

The liquid-cooled facility would feature a 2N redundant topology and is targeting Tier IV certification by Uptime Institute.

VisionWave noted that the data center would require “substantial capital” to develop, which would be sourced through capital-markets activities and/or project-finance facilities.

“We are pleased to have signed a term sheet for a proposed joint venture to develop a Tier IV data center in Israel. The proposed all-share structure would allow us to pursue a 51 percent effective interest in the project without an upfront cash outlay, while we conduct due diligence and work toward definitive agreements. Completion of the transaction remains subject to a number of conditions, and we will provide further updates as appropriate,” said Doug Davis, CEO of VisionWave Holdings, Inc.

“The data center is an underground, hardened Tier IV-targeted design. We are pleased to bring this project into a proposed joint venture with VisionWave and to advance it through due diligence and definitive documentation,” added Yuval Birman, CEO of Lucky Whale Production Limited.

VisionWave, which went public via a SPAC merger last year, describes itself as a developer of autonomous unmanned systems and AI-powered perception software. Much of the company’s efforts are focused on the defense sector, and it recently won a contract to provide drone-based surveillance systems at football/soccer matches in Mexico this summer during the FIFA World Cup.

Its offerings include a proprietary sensing technology platform that monitors radio frequency signals, an operational management platform for autonomous vehicles (including drones and its own unmanned ground vehicle), and an Edge processing platform. The firm also owns a drone subsidiary (Solar Drones) and an aerospace-focused materials company.

VisionWave is far from the only company to dive into the AI and data center sector in recent years, despite a lack of relevant history.

Shoemaker Allbirds recently announced plans to sell its core business and pivot to AI, renaming itself NewBird AI in the process.

A Taiwanese whiskey importer, a recruitment website, a Singaporean healthcare company, an Indian TV production firm, a K-pop-focused media company, a Chinese car loan financing company, an aviation operator, and an owner of Hard Rock Cafe franchises in Malaysia have all looked to move into the data center and AI space in recent years.

An electric truck maker is also pitching mobile containerized data centers on wheels as a concept.