Intel (INTC) is in advanced discussion with privately owned SambaNova Systems Inc. to acquire the artificial intelligence chip startup for roughly $1.6B, including debt, Bloomberg News reported, citing people familiar with the matter.
The parties could reach a buyout agreement as early as January, the people said, asking for anonymity because the information is not yet public.
Terms and timing of the deal could change, according to the people, who added that SambaNova, which has signed term sheets with other potential investors, could seek another strategic direction.
Intel (INTC) CEO Lip-Bu Tan serves as chairman of Palo Alto, California-based SambaNova, which designs custom AI chips in a market dominated by Nvidia (NVDA).
A potential acquisition is expected to give Intel (INTC) a much sought-after platform to help build out its AI portfolio at a discount, after SambaNova drew a $5B valuation in 2021 as part of a funding round led by SoftBank Group’s (SFTBY) (SFTBF) Vision Fund 2.