(Oct 31): Intel Corp is in preliminary talks to buy artificial intelligence (AI) chip startup SambaNova Systems Inc, according to people familiar with the matter.
Intel is discussing the terms of an acquisition with SambaNova, which has been working with bankers to gauge interest from potential suitors, the people said.
Any deal would likely value SambaNova at below the US$5 billion it fetched in a 2021 funding round, the people said, asking not to be identified because the information is private.
Deliberations are in the early stages and there’s no certainty that the companies will reach an agreement, according to the people. Another buyer could also emerge, they said.
SambaNova is always looking at strategic opportunities that support its mission and stakeholders, said a spokesperson for the company, who declined to comment further.
A representative for Intel declined to comment. The Information reported earlier that SambaNova was exploring a sale.
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Founded in 2017 by Stanford University professors, one of whom had won a MacArthur Genius Award, SambaNova designs custom AI chips that aim to rival those offered by Nvidia Corp. For Intel, an acquisition of SambaNova would bring into its fold a company that chief executive officer Lip-Bu Tan knows well.
Tan has served as SambaNova’s executive chairman and, after joining Intel, as its chairman. His venture capital firm Walden International was one of the company’s founding investors, having led a US$56 million Series A round in 2018. SoftBank Group Corp led a US$676 million funding round in 2021 that valued the startup at US$5 billion.
Since then, the AI processor space has grown rapidly with the release of ChatGPT and the advent of generative AI. As Nvidia has dominated the market for chips used to train powerful AI models, SambaNova has moved to focus on the inference space, or systems that run models that are already developed.
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SambaNova also shifted to focusing on inference on its own hardware, and offers its products both as a cloud service and as an on-premises solution. In April, the company laid off about 15% of its workforce.
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