In April, US AI chip giant Nvidia announced it would acquire an Israeli AI infrastructure orchestration and management company. Ran: Ai. The deal has since stalled due to an investigation by U.S. antitrust regulators. But today, the deal was completed following approval from US and EU regulators.
Nvidia will pay an estimated $800 million for Run:ai, of which the company’s founders and employees will receive $200 million. NVIDIA’s stock price rose more than 70% between the deal’s announcement in April and its completion over the past few days. It is unlikely that the investor’s return would have increased at the same rate, and it is possible that an arrangement was agreed to set a range on the value of the shares to ensure that the value of the transaction did not skyrocket, as is customary in such transactions. There is. To the same extent. At the same time, the value of the retention plan to entrepreneurs and employees will clearly benefit from the delay, given the Nvidia stock, which has increased from about $100 million to nearly $200 in eight months.
Approximately 150 employees will join NVIDIA’s offices in Tel Aviv and Yokneam. Approval of the acquisition will allow Nvidia to expand its Israeli development center as a major software development center outside the United States. A few months ago, Nvidia acquired an Israeli AI company Deci AIhas also joined the company’s expanded development center.
Retention bonuses are typically given to employees or entrepreneurs to ensure they stay with a company for a certain number of years and don’t leave before then. Such compensation is provided through restricted stock units (RSUs), that is, shares that can only be exercised after a number of years, or that can be partially exercised over a predetermined period of time.
“Today, we close one chapter in Run:ai’s extraordinary journey and are excited to begin a new and exciting chapter with the official addition of Nvidia,” Run:ai founders Ronen Dar and Omri Geller said in a blog post. I am very happy,” he wrote. Nvidia also welcomed the completion of the deal, but none of the parties mentioned the lengthy investigation by US authorities that delayed the long-awaited deal and jeopardized Nvidia’s expansion in Israel.
The Politico website revealed that the US Department of Justice has been conducting an antitrust investigation into Nvidia’s acquisition of an Israeli startup in recent months. Run:ai has developed a platform that allows you to run more operations on Nvidia’s graphics processors, eliminating the need to purchase additional proprietary processors. Sources who spoke to Politico said regulators were concerned that Nvidia had acquired an Israeli company with the purpose of “curtailing technology that could constrain a major revenue stream.”
Nvidia, for its part, sought to prove that the acquisition would not have a negative impact on the market and would not limit the use of the Run:ai platform to only Nvidia customers. On the contrary, according to Run:ai’s blog, it appears that Nvidia is trying to make its products accessible to as many users as possible outside of its ecosystem. Run:ai’s platform is also used by competing AI accelerators such as Intel and AMD, and is used by customers of Nvidia’s DGX cloud service, as well as those interested in local (on-premises) or externally delivered services. . Cloud providers such as Amazon, Google, and Microsoft.
Globes, Israel Business News – en.globes.co.il – Published December 30, 2024
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