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Prominent South Korean fabless chipmakers Rebellions and Sapeon are merging

As NVIDIA's market cap crosses $3T and major tech giants develop their AI chips to reduce reliance on NVIDIA, South Korean fabless AI chip startups Rebellions and Sapeon are merging to better compete against global rivals in the rapidly growing AI hardware market.

Ellie Ramirez-Camara profile image
by Ellie Ramirez-Camara
Prominent South Korean fabless chipmakers Rebellions and Sapeon are merging
Credit: Rebellions

News that South Korean startups Rebellions and Sapeon are merging as a strategic move to consolidate South Korea's fabless AI chip industry comes exactly a week after NVIDIA displaced Apple as the second-most valuable public company as NVIDIA's market cap crossed the $3 trillion mark and placed the company just above Apple and right behind Microsoft. With the merger, both companies expect to become a market-leading entity better equipped to take on the competition.

Even if NVIDIA is the undisputable leader in the global AI chip market, there is plenty of room for action as demand for chips continues to soar. In parallel, as chip availability declines, computing costs continue to increase. The current state of the market has already led Apple, Google, Amazon, and Microsoft to develop in-house hardware to power their data centers and AI applications. More recently, an initiative led by Intel, AMD, Google, Meta, and other tech giants aims to develop a new chip interconnect standard to counteract NVIDIA's dominance.

Both companies expect to complete the merger in the second half of 2024. The new entity will incorporate all employees from Sapeon and Rebellions, with the latter expected to manage the new entity. Since SK Telecom and SK Hynix back Sapeon and KT owns Rebellions, SK Telecom, SK Hynix, and KT will remain stakeholders in the merged entity. Moreover, Rebellions will continue its partnership with Samsung Electronics to continue production of the Rebel and Atom chips. As both companies offer neural processing units (NPUs) and the demand for NPUs is rapidly increasing, Sapeon and Rebellions will focus on strengthening their NPU business post-merger.

In February, Rebellions earned the title of South Korea’s best-funded semiconductor startup after raising $124 million in Series B funding, which placed the company's valuation at $658 million. Sapeon was last valued at $378 million in August 2023 after raising a $45 million Series A funding round.

Ellie Ramirez-Camara profile image
by Ellie Ramirez-Camara
Updated

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