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Dutch chip equipment giant ASML has agreed to invest €1.3bn in French artificial intelligence start-up Mistral, forging an alliance between two of Europe’s leading technology companies at a time of heightened concern over reliance on US Big Tech groups.
Mistral is raising a total of €1.7bn in its latest round of funding, the company said on Tuesday, valuing the two-year-old start-up at nearly €12bn, including the new funds raised.
Christophe Fouquet, ASML chief executive, said the decision to invest such a large sum in Mistral, becoming its biggest shareholder, reflected a view that AI will be a “strategic technology” and a desire to demonstrate “long-term trust”.
The deal brings together Europe’s top AI start-up and one of the continent’s most valuable public companies, which supplies the equipment to make the advanced chips that are used to train and run AI models.
Arthur Mensch, Mistral’s chief executive, said that for both economic and strategic reasons, “it’s important for European companies not to have too much dependency on US technology”.
But the CEOs of both companies played down the idea that the tie-up was motivated by a desire to strengthen European tech sovereignty at a time when the region is increasingly caught up in tensions between the US and China.
ASML has been hit by both US tariffs on imports and Washington-led restrictions on the kinds of chipmaking equipment it can sell in China. Nonetheless, Fouquet insisted that it did not just “pick Mistral because they were European”.
Sovereignty was an “additional benefit”, he said. “I think this will help the European ecosystem, but we do it because it’s good for Mistral and it’s good for ASML.”
Mensch said the tie-up would help develop its systems’ capabilities beyond the same generic functions offered by rivals. “There’s a lot of expertise that we will never be able to put into [our AI] models if we don’t find the right partners,” he said.
Paris-based Mistral, which now has more than 350 staff, is also raising new capital from existing investors Andreessen Horowitz, Bpifrance, General Catalyst, Index Ventures, Lightspeed and Nvidia.
At €11.7bn, Mistral’s price tag has roughly doubled since its last funding round in June 2024. But the maker of the Le Chat chatbot lags far behind its US-based competitors.
ChatGPT maker OpenAI is discussing a new share sale that would value it at $500bn, and Anthropic announced a deal putting its worth at $183bn last week.
Mistral also faces growing competition from Chinese players such as DeepSeek and Alibaba for “open source” AI systems, which make advanced AI capabilities freely available for anyone to use.
Mensch said the company was “taking a different direction” to its US rivals.
“Our US competitors are more focusing towards the mass-market consumer side . . . For us, most of the value we can help create is in partnering with truly technological companies,” he said.
Mistral’s customers already include automotive group Stellantis, which owns brands like Fiat and Chrysler. It is using its AI tools to help manage its supply chain as well as to develop an in-car assistant. Mistral also works with the French shipping group CMA CGM, as well as several French government departments.
ASML makes some of the most sophisticated and expensive machines in the world. Its chipmaking equipment can cost hundreds of millions of euros and contain as many as 100,000 parts.
In the short term, Fouquet said ASML would begin using Mistral’s AI expertise to help develop new chipmaking tools, as well as offering customers new capabilities as they use its existing systems.
“We started to look for a partner, because we thought that this is not something we should try to do ourselves,” Fouquet said. He said the company’s expertise is in chipmaking equipment and they are “not AI experts”.
The companies also hinted at broader ambitions in the future. “There are many opportunities down the line with ASML to partner on bridging the gap between the [semiconductor] value chain and the AI value chain,” Mensch said.
Mistral has struck several lucrative contracts with large customers in recent months by adopting a sales tactic similar to US data analytics provider Palantir, sending “solutions architects” to consult with each customer on bespoke AI systems.
Mensch said it has now secured contracts with an annual value of more than €300mn, with the total value of contracts signed since it launched in June 2023 reaching €1.4bn. Just over half of its business comes from Europe.
