Cohere acquires Aleph Alpha in $600M European AI push

Canadian artificial intelligence company Cohere has agreed to acquire German AI startup Aleph Alpha in a deal aimed at creating a major European alternative to U.S. technology giants, with Schwarz Group committing to invest $600 million in Cohere's upcoming Series E funding round as part of the transaction. The acquisition, announced Friday in Berlin with German Digital Minister Karsten Wildberger and his Canadian counterpart Evan Solomon in attendance, will see Cohere shareholders retain approximately 90 percent of the combined company while Aleph Alpha shareholders receive roughly 10 percent. Financial terms remain undisclosed and the deal is subject to regulatory approval, with closing expected sometime in 2026. The merger is designed to strengthen both companies' ability to serve highly-regulated sectors including government, finance, defense, energy, healthcare, and telecommunications across Europe. Aleph Alpha brings extensive experience with German public sector clients, including contracts with the German Ministry for Digital Affairs and State Modernization and the Baden-Württemberg regional government. "We are going to commit to working with European infrastructure and maintain the sovereignty requirements that are being addressed in Europe," said Cohere CFO Francois Chadwick in an interview with Reuters. Founded in 2019, Aleph Alpha was initially positioned as Germany's answer to OpenAI but later pivoted from developing large language models to building specialized AI applications for businesses. Cohere, also founded in 2019, has raised $1.6 billion to date from investors including Nvidia and AMD, achieving a valuation of $7 billion in 2025. "Combining the strengths of Cohere and Aleph Alpha accelerates our global expansion and advances our mission to deliver sovereign AI to nations around the world," said Cohere CEO Aidan Gomez, describing the partnership as built on "shared Canadian and German values where privacy, security and responsible innovation are paramount."