Cohere and Aleph Alpha Merge in $20B Deal

AI startups Cohere and Aleph Alpha have signed a merger agreement, formalizing a plan announced in April. The combined company, valued at $20 billion, will operate under the Cohere brand with dual headquarters in Berlin and Toronto, backed by a €500 million investment from German retailer Schwarz Group and a potential $3 billion from a Canadian government-backed consortium. Toronto-based Cohere reported $240 million in revenue last year and was valued at $7 billion in September 2024. Germany-based Aleph Alpha specializes in small language models for enterprises and governments. The merged entity will prioritize expanding its partnership with Schwarz Group, whose cloud unit STACKIT and planned 100,000-GPU data center could provide significant infrastructure support.