Nebius Group Pursues AI21 Labs Acquisition, Shares Rally 33%

Nebius Group NV is reportedly in talks to acquire AI21 Labs, an Israeli AI startup. This potential acquisition aims to transform Nebius from an infrastructure provider into a full-stack AI company. The news led to a significant increase in Nebius's share price, which rose by 33.2% week-on-week.

This strategic move follows AI21 Labs' previous unsuccessful merger discussions with Nvidia, which were valued at approximately $3 billion. Nebius has also recently secured a substantial $27 billion contract with Meta Platforms Inc. for AI compute capacity and received a $2 billion investment from Nvidia, alongside a partnership to develop hyperscale cloud solutions for the AI market.

Cantor Fitzgerald has issued an "overweight" rating for Nebius, setting a price target of $129, citing strong demand for data centers and the expanding artificial intelligence sector. Nebius is actively expanding its data center portfolio, targeting 3 GW of contracted capacity by year-end, with projects underway in Missouri and Finland.