Samsung weighs €1B Mistral stake as AI chip race tightens

Samsung Electronics is engaged in negotiations about buying a stake in French artificial intelligence company Mistral. This acquisition will bring the world’s leading manufacturer of memory chips closer to one of the top European AI companies. The Financial Times was the first to report on the negotiations on July 21, with Axios and Yahoo Finance confirming the information the following day.

The potential investment can be seen as part of a larger trend in the AI market in the sense that chipmakers do not merely provide hardware anymore but also invest in AI firms. Earlier this week, the Financial Times reported that AMD was willing to invest almost $5 billion in Anthropic, demonstrating how hardware producers form fresh connections with AI businesses through capital investing and partnerships.

A €1 billion bet that comes with chips attached

Reports suggest that Samsung is considering investing roughly €1 billion (or about $1.09 billion). This means Mistral’s valuation will increase to approximately €20 billion, nearly doubling the company’s previous €11.7 billion valuation. Reports also indicate that EQT’s Scaleup Europe Fund is exploring options in this matter.

If completed, the funding round will bring together Samsung’s corporate support with European institutional capital, thus boosting Mistral’s status as one of the prominent AI companies on the continent. TradingKey went on to mention that Samsung might gain a seat on Mistral’s board of directors and preinstall Mistral’s AI models in other Samsung AI chips, creating an advanced partnership with Mistral beyond just a financial investment.

Why a memory-chip giant wants an AI client

Samsung sees the clear advantage: acquiring a long-time customer for its cutting-edge chips. Samsung is one of the only manufacturers of high-bandwidth memory (HBM) and high-level logic chips, and thus is perfectly placed to take advantage of the skyrocketing demand for AI technology. TradingKey has observed that the demand for such chips is higher than the supply, which makes reliable customers more important.

Mistral would have an equally significant benefit – a stable supply of chips to train and operate more powerful AI models. According to Financial Times journalists Ivan Levingston and Tim Bradshaw, the negotiations take place at the time of a worldwide shortage of complex chips, as the manufacturers are urgently trying to increase output.

The possible cooperation comes at a challenging time for Samsung, according to TradingKey, which noted shares dropped almost by 24% over the past month as investors became concerned about the trajectory of spending on AI. Nonetheless, the share price ended 0.58% up in Seoul on the day the news of negotiations broke.

Europe’s push to own its AI stack

Mistral was founded in 2023 in Paris and has achieved fame and recognition as one of the top AI start-ups in Europe as a result of its sophisticated open-source large language models that customers can download and use independently.

This strategy is becoming more important now that businesses all over Europe are assessing their dependency on American AI technology providers. After restrictions imposed by Trump’s administration last month limited access to Anthropic’s Mythos and Fable technologies, businesses began to consider domestic alternatives more seriously. A European technology investor discussed with the Financial Times that limitations created skepticism about foreign-based AI technology dependency.

Reuters similarly summarizes the trend:

“There is a growing interest in Europe and elsewhere to reduce dependence on U.S. technology so other countries may have greater say in their future society and economy.”

Any investment from Samsung would still require approval from European regulators, according to TradingKey. Neither company has commented publicly on the reported negotiations.

Talks that started at a chip campus in the spring

The discussions are based on the prior connection between the two companies. In April, Arthur Mensch, the chief executive of Mistral, met with Jeon Young-hyun, the head of Samsung Device Solutions, to discuss the supply chains of the AI chips at Samsung’s semiconductor plant located in Hwaseong. This was just after French President Emmanuel Macron visited South Korea for talks with President Lee Jae Myung.

CEO Arthur Mensch previously said Mistral is on track to exceed $1 billion in annual recurring revenue (ARR) by the end of 2026, reflecting rapid enterprise adoption. Axios highlights that the fundraising comes as Chinese AI developers, particularly Moonshot AI with its Kimi K3 model, are increasing pressure on both U.S. and European AI companies. That broader competitive landscape may be encouraging strategic investors to move more quickly.

Samsung had previously backed Mistral through its venture capital division. The proposed investment of €1 billion would expand the cooperation between the two companies, enabling them to secure their positions as the competition in the international AI race intensifies.

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