US-based Xilinx acquires Chinese AI chip start-up
US-based technology company Xilinx Inc announced on Tuesday that it has acquired a leading Chinese start-up specializing in artificial intelligence (AI) chips called DeePhi Technology Co, reversing a long-standing trend of Chinese companies going abroad for such acquisitions and signaling the rise of the Chinese AI industry.
A statement from Xilinx did not disclose financial terms or other details of the acquisition. But a report on news website thepaper.cn said that industry estimates put acquisition's value at $300 million.
Based in Beijing, DeePhi has industry-leading capabilities in machine learning, specializing in deep compression, pruning and system-level optimization for neural networks, according the statement.
“DeePhi is really at the top in the field of AI chips,” Xiang Yang, an analyst at Beijing-based CCID Consulting, told the Global Times Thursday. “That is the reason Xilinx bought it.”
Xiang said that it is rare that a US technology company acquires a startup in China, especially in the fields of chips and AI. “But the acquisition shows the rise of Chinese tech startups in recent year, with their technological capabilities continuing to improve,” he said.
Founded by four young Chinese entrepreneurs just two years ago, DeePhi has grown into a 200-employee company and a major player in AI chip development. Before the acquisition, DeePhi’s technologies had already been used in Xilinx’s semiconductor devices. Xilinx has also been a major investor in DeePhi.
“We are excited to continue our strong partnership with Xilinx and work even more closely to deliver leading machine learning solutions to our customers in China and around the world,” Song Yao, CEO of DeePhi Tech, was quoted by the Xilinx statement as saying.
But Xiang said that the acquisition is not necessarily good news for China’s AI industry. China has been focused on developing technologies of the future, including AI, and making its own chips to cut reliance on foreign sources.
“Being acquired means that your technologies will now belong to a US firm. Certainly, it’s a loss for China’s technology development,” he added.
He said that the acquisition highlighted a challenge faced by Chinese start-ups in raising money. “This could be one of the reasons that DeePhi agreed to the acquisition – it has had a hard time raising money,” Xiang said.