Thursday, January 29th, 2015
By: Vanessa Kimanga, January 29, 2015
Seattle-based Amazon has reportedly agreed to acquire Israeli chip maker, Annapurna Labs for an estimated $350M. A spokeswoman for Amazon confirmed the deal last Thursday, although the amount may rise to $375 million. The deal also calls on Amazon to establish an R&D center in Israel.
Based in Israel, Annapurna Labs was founded in 2011 by Avigdor Willenz, the founder of Galilieo Technologies Ltd. Annapurna describes itself as a “cutting edge technology startup”, although what technology it has been developing remains a secret. It is rumored that Annapurna has developed networking chips that can transmit more data more efficiently, and that Amazon will use this technology to continue expanding its data network centers. Amazon rents its data storage to more than a million businesses worldwide which brings in an estimated $6 billion in revenue every year.
It’s becoming quite a common practice to acquire tech companies from Israel, which is not surprising since the country is a thriving hub of high-technology and entrepreneurship. Dropbox bought Cloud-on which was a Israeli-based startup. China’s Alibaba announced it would invest in the Israeli startup, Visualead. Although we may not know what exactly Amazon has in store with this new acquisition, for $350M it’s certainly going to be a game changer.