As European governments search for alternatives to US-controlled AI infrastructure, a transatlantic merger is making the case that sovereignty can scale.
Canadian AI company Cohere is acquiring German startup Aleph Alpha in a deal that would create a combined entity valued at around $20 billion, positioning the merged business as a sovereign alternative to US AI laboratories, including OpenAI and Anthropic.
The transaction, which has not yet closed and whose financial terms have not been fully disclosed, has been endorsed by both the German and Canadian governments. Under the deal’s structure, Cohere shareholders are set to receive approximately 90% of shares in the combined company, with Aleph Alpha shareholders receiving around 10%, according to German media reports.
Schwarz Group — the conglomerate that owns supermarket chain Lidl and is a major Aleph Alpha shareholder — will invest $600 million into Cohere’s upcoming funding round as part of the transaction, the companies said.
“We are bringing Aleph Alpha into Cohere, and we are going to merge the two entities,” said Cohere CFO François Chadwick. “We are going to commit to working with European infrastructure and maintain the sovereignty requirements that are being addressed in Europe.”
Cohere, founded in 2019 and most recently valued at $7 billion in 2025, builds AI models focused on the enterprise market. Aleph Alpha, also founded in 2019, was among the first European large-language-model startups before pivoting from model development to helping businesses and governments deploy and govern AI. The combined entity will offer AI services to businesses and government agencies — particularly European ones — that want control over their data and infrastructure rather than dependence on US-headquartered providers.
Also Read: Sanchit Monga on Why the Hyperscalers’ Biggest Strength Is Also Their Blind Spot
Ilhan Scheer, co-chief executive of Aleph Alpha, said the deal would give European institutions access to AI they could genuinely own. “Together with Cohere, we are building a real counterweight for organizations that refuse to outsource control over their AI to a single provider or jurisdiction,” he said. “Giving European institutions and enterprises access to powerful, yet controllable AI they can truly own.”
Aidan Gomez, co-founder and chief executive of Cohere, framed the merger as an acceleration of the company’s global sovereign AI ambitions. “Organizations globally are demanding uncompromising control over their AI stack,” he said. “This transatlantic partnership unlocks the massive scale, robust infrastructure, and world-class research and development talent required to meet that demand.”
