Nebius plans Baltic region’s first AI factory in Hüüru

Netherlands-registered technology company Nebius plans to open the Baltic region’s first artificial intelligence factory in Hüüru by the end of the year, but its Russian background has drawn the attention of Estonia’s Internal Security Service, ERR reported.

The 22-megawatt facility in Harju County will be designed for Nvidia AI chips. The expansion of the Greenergy Data Centers facility will cost nearly 100 million euros and is expected to create about 150 jobs.

“We essentially produce intelligence from electrons. We provide the cold room and a considerable amount of electricity, while Nebius offers intelligence services to its customers,” said Miko Niinemäe, head of Tensor Estate.

Nebius was established during the restructuring of Yandex’s parent company after the sale of its Russian assets. It is led by Yandex co-founder Arkady Volozh and employs hundreds of former Yandex engineers.

“There is nothing wrong from my perspective. This is a Dutch company that is not sanctioned in any way and has already built several artificial intelligence factories within the European Union,” Economy and Industry Minister Erkki Keldo of the Reform Party said. He added that Estonia needs high-technology investment, but that the risks linked to Nebius’s ties to Russia must be reduced.

Nebius cannot undergo the usual foreign investment screening procedure because it is registered in the European Union. The Internal Security Service is primarily monitoring people connected to the company who have ties to Russia.

“In the case of Russian citizens, there is still an obligation of loyalty to Russia. In a war or crisis situation, they must fulfil that obligation to their country,” said Marta Tuul, a spokesperson for the Internal Security Service.

Volozh, Nebius’s major shareholder and a billionaire computer scientist, has lived in Israel since 2014. After being placed under European Union sanctions, he stepped down as Yandex chief, condemned Russia’s invasion of Ukraine and gave up his Russian citizenship this year. He was removed from the EU sanctions list in 2024.

Nebius communications director Tom Blackwell said the company was proud of the engineers who had left Russia. “These are people who could walk into a Silicon Valley start-up or technology giant any day. We are very proud to have such engineering talent, and it was in some ways the foundation of our success story, but otherwise Nebius is an entirely new company,” he said.

Niinemäe said Tensor Estate had contacted Estonia’s security authorities itself to discuss the risks related to its partner. He said the company had also examined the matter and noted that Nebius had operated in Finland almost from its first day, with Finnish security authorities having assessed the situation and given their approval.

Investors in Tensor Estate include Kristjan Rahu, Jüri Käo, Armin Karu and Bolt founder Markus Villig. The Nebius AI factory at the Greenergy Data Centers facility in Hüüru is expected to be the largest in the Baltic states, with a capacity of 22 megawatts.