According to recent media reports, Intel Corporation (NasdaqGS:INTC) is on track to acquire AI chip startup SambaNova(SambaNova Systems, Inc.). SambaNova offers a full-stack AI platform that helps run AI applications both on private clouds and in data centers. Rumors around the deal started in October, but they seem to be getting more credible as time passes, especially with the two companies already having an existing relationship.
Lip Bu-Tan, who is the CEO of Intel, is also the executive chairman of SambaNova. Intel Capital has already made an investment in the company, and Japanese tech company SoftBank (SFTBY), which took a stake in Intel in August, is also a stakeholder in SambaNova. This brings back the AI circular economy debate, but the relationship raises the probability of an eventual acquisition of SambaNova by Intel.
The deal will help Intel penetrate a market segment it has been lacking in. As things stand, Intel does not offer AI appliances like the Nvidia (NVDA) DGX racks or GroqRack. SambaNova sells similar racks and, therefore, allows Intel to enter the enterprise AI market to snatch market share from other AI companies.
The fact that SambaNova already has some traction in finance, healthcare, defense, and the government is a positive sign for Intel if the acquisition goes through. Investors would need to wait for regulatory approval and initial feasibility studies before a deal is finalized.
