This transaction offers a big injection into Mistral and makes it one of Europe’s most valuable private companies
(Amsterdam) ASML Holdings is investing 1.3 billion euros ($2 billion) in French Mistral AI.
The investment has made ASML the largest shareholder in Mistral, with 11% of its shares being the stock, the company said in a statement on Tuesday (September 9). Mistral, which develops AI models and chatbots, said the investment is part of a 1.7 billion euro funding round. This brings its valuation to 11.7 billion euros, making it one of Europe’s most valuable private companies.
The Alliance gives AI Giants such as Openai, which supports one of the continent’s biggest and most powerful high-tech companies, Mistral, Europe’s only trusted rival. This is a victory for the Bullock’s sovereign technology movement, gaining momentum amid a decline in reliance on tools from Silicon Valley and crackdowns on countries that President Donald Trump believes will undermine U.S. interests.
Still, ASML CEO Christophe Fouquet said the main purpose of the deal was to integrate AI within the company rather than building European champions. With investments and involvement in ASML’s company, ChIP equipment manufacturers offer a way to incorporate Mistral’s generation AI services into their machines and operations.
“We want to flood the entire ASML organization with AI,” Fuquet said in an interview.
Reuters first reported the investment on Sunday.
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The Dutch company is the only producer of cutting-edge lithographic equipment used by semiconductor companies to create advanced chips for products such as Apple’s iPhones and Nvidia’s AI accelerators. ASML has not previously supported AI companies and rarely ventures into startup investment.
In the case of Mistral, this deal offers a big injection in expensive, competitive markets. Founded in early 2023, Mistral pitched itself as an alternative to Silicon Valley stubborn people like Openai and Google. The startup is at the heart of French President Emmanuel Macron’s strategy to turn the country into a serious AI competitor.
Mistral CEO Arthur Mensch said the pairing with the European company was “cake cherry blossoms.” “This is a good story about two European champions working together,” he said. “I want to see more.”
Mensch said the company’s three co-founders and employees remain majority shareholders. Previous investors who will participate in the funding round at ASML include Nvidia, US venture capital firms Andreessen Horowitz, General Catalyst and DST Global.
Roger Dassen, Chief Financial Officer of ASML, will be on the Mistral board of directors.
Mistral has announced deals with major European companies, including BNP Paribas and Stellantis NV, but despite the push to the market, it has not revealed any major US clients.
He also struggles to keep up with his American rivals. US peers such as Openai, Anthropic and Elon Musk’s Xai have raised a fair amount of money. Openai’s valuation reached US$500 billion in recent secondary stock sales.
Recently, Mistral highlights how to tailor open source models for businesses, providing more flexibility than its competitors. Mensch said the ASML partnership focuses on specific industries, such as Mistral manufacturing.
Fouquet said Mistral’s technology will be used to improve the performance of the machine’s software and scanning technology. “We’re not trying to do everything ourselves,” Fuquet said when asked if ASML would rule out taking over the Mistral. “We are not trying to vertically integrate all the capabilities,” he said ASML considered other AI companies as potential partners but did not name them.
Analysts at New Street Research said in a memo on Monday that the generated AI can make ASML’s machines more accurate by collecting and analyzing more data from performance. “Investments of less than 1% of ASML’s market capitalization will primarily be justified to access cutting-edge IP and skills in that domain,” said analysts Pierre Ferag and Rolfvalk.
Citigroup analysts called the partnership “long-term positivity” in a memo on Tuesday. “ASML aims to drive product development through the use of AI models and bring solutions to the market faster and higher performance,” said analysts, including Andrew Gardiner.
Unlike other companies in the semiconductor industry such as Nvidia and Intel, ASML is primarily separate from venture investment. It supported several local startups, including the Dutch Technology Fund and integrated circuit developer Smart Photonics, in a round of 100 million euros. More typically, they buy stocks in elements of the supply chain, such as holdings by optical company Carl Zeiss Smt, to help advance lasers used in machines. Bloomberg
