Meituan is buying a co-founder’s generative AI startup for almost $234 million, a deal that gets the food-delivery giant into a Chinese race to develop ChatGPT-like services.
Meituan agreed to pay that amount in cash while also assuming startup Light Year’s roughly 367 million yuan ($51 million), according to a stock exchange filing. The Chinese company will inherit about $285 million of cash.
Light Year was the brain-child of Wang Huiwen, who this year declared his intention to get into the burgeoning effort to develop next-generation AI, reportedly staking $50 million of his own money. Meituan’s billionaire chairman Wang Xing joined in a round of funding for the firm about a month later, citing the pair’s 20-year partnership that included building the world’s largest meal delivery service.
But Wang Huiwen then encountered unspecified health issues that forced him to vacate his positions, the company said in a separate, Chinese statement. Company representatives declined to comment further on Wang’s condition on Thursday.
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Meituan now joins Chinese internet rivals from Baidu Inc. to Tencent Holdings Ltd. and Alibaba Group Holding Ltd. in a contest to develop generative AI services. They join a plethora of startups, scientists and former tech engineers inspired to delve deeper into generative AI after OpenAI’s ChatGPT took the world by storm in November.
“We are acquiring leading AI technology and talent with this deal,” the company said in its statement. “That gives us the opportunity to strengthen and quicken our competitiveness in AI.”
