Pliops merger with Kalray falls through after stock price collapses
The Israeli startup, which develops acceleration solutions for AI and storage servers in data centers, was set to merge with Kalray, a French provider of advanced data processing solutions. However, the deal will not go ahead after Kalray lost more than half of its value over the past two months.
Israeli startup Pliops, which develops acceleration solutions for AI and storage servers in data centers, will not merge with Kalray, a French provider of advanced data processing solutions. The agreement to merge was announced two months ago, but with Kalray shares dropping by over 50% since, and the merger being an all-stock deal, the French company has announced that it will not go ahead.
“Economic conditions, and in particular financial market trends, were not conducive to finalizing a capital-intensive combination that would create value for shareholders,” Kalray said in its announcement. “However, the management teams of the two companies remain convinced that their technological strengths will complement each other to offer unified, cutting-edge solutions for generative AI (GenAI) and data acceleration in the storage sector. The parties will therefore study commercial ways of combining Pliops' KV technology with Kalray's MPPA architecture.”
Pliops, founded in 2017, has raised over $200 million to date from leading investors including Koch Disruptive Technologies, State of Mind Ventures Momentum, Intel Capital, Viola Ventures, SoftBank Ventures Asia, Expon Capital, NVIDIA, AMD, Western Digital, SK hynix and Alicorn. It was last valued at around $650-700 million when it raised a $100 million Series D in August 2022.
The merger terms proposed that Kalray shareholders will hold 65% of the new entity, with Pliops shareholders holding up to 35%, potentially increasing to 40% upon achieving strategic milestones. Even at Kalray’s market cap from two months ago of around just $150 million, the value of the merged company was set to be approximately 240 million euros, and the value of Pliops would be about $100 million, over 80% less than the company was valued two years ago.
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Pliops, which employs around 120 people, was founded by Uri Beitler, Aryeh Mergi and Moshe Twitto. Beitler was replaced as CEO last June by Ido Bukspan, who previously served as SVP of Chip Design at NVIDIA. Beitler became Chief Strategy & Business Development officer.
Pliops has developed technology that provides a solution for the rapidly growing volumes of data and solves the problem of slow computational performance. The company's data processor radically simplifies the way the data is processed and storage is managed at data centers.
