Canadian artificial intelligence company Cohere has agreed to acquire German AI firm Aleph Alpha in a deal aimed at creating a more independent alternative to dominant U.S. technology players in the global AI market.
The financial terms of the transaction were not disclosed. Following completion, the combined company will operate under the Cohere name and remain anchored in both Canada and Germany, subject to approval by Aleph Alpha’s shareholders.
The transaction brings together two enterprise-focused AI companies seeking to position themselves as providers of secure and customizable AI solutions for highly regulated industries, including finance, healthcare, telecoms, defence, energy, and the public sector.
Cohere CEO Aidan Gomez said the merger would accelerate growth and strengthen the availability of secure, sovereign AI technologies for organizations seeking greater control over their AI infrastructure. He described the transaction as a way to combine both companies’ research, infrastructure, and commercial capabilities to meet rising demand for alternatives to U.S.-based AI providers.
The deal comes amid increasing political and commercial interest in “sovereign AI” as governments and businesses seek to reduce dependence on a small number of large American technology firms. European policymakers in particular have pushed for stronger domestic AI capabilities amid concerns over strategic reliance on foreign digital infrastructure.
Aleph Alpha was initially viewed as Germany’s leading challenger to OpenAI but has since shifted away from developing frontier large language models and toward enterprise-focused AI applications, bringing its strategy closer to Cohere’s business model.
As part of the transaction, Aleph Alpha investor Schwarz Group will commit approximately $600 million to Cohere’s upcoming financing round. Schwarz, which owns retail chains Lidl and Kaufland and also operates cloud infrastructure services, is expected to play a strategic role in supporting the combined company’s expansion in Europe.
The merger follows Canada and Germany’s recent efforts to deepen cooperation on technology policy through their Sovereign Technology Alliance, reflecting broader geopolitical efforts among allied countries to build independent digital capabilities.
The acquisition also strengthens Cohere’s position as one of Canada’s most prominent AI companies. Founded in 2019, the Toronto-based company provides enterprise AI systems to customers including Royal Bank of Canada, Salesforce, and Oracle. Aleph Alpha, founded the same year, serves major European clients including Deutsche Bank, Bosch, and SAP.
The transaction comes as Cohere continues to scale ahead of a potential future public offering, with the company reportedly preparing a new funding round in the coming months. Cohere was last valued at $6.8 billion following a capital raise in 2025.
