FuriosaAI, a South Korean startup specializing in AI chip development, has rejected an $800 million acquisition offer from tech giant Meta, according to a local media report. The startup has instead chosen to focus on developing and producing its AI chips, citing disagreements over post-acquisition business strategy and organizational structure as the primary reasons for the breakdown in negotiations.

The acquisition offer was reportedly driven by Meta's desire to reduce its reliance on Nvidia for chips specialized in training and building large language models (LLMs). Meta has been actively investing in its AI initiatives, unveiling its custom AI chips last year and committing to invest up to $65 billion this year to support its AI efforts. However, FuriosaAI's rejection of the offer suggests that the startup is keen on maintaining its independence and pursuing its own vision for AI chip development.

FuriosaAI was founded in 2017 by June Paik, a veteran of Samsung Electronics and AMD, with the goal of developing AI chips that can compete with industry leaders Nvidia and AMD. The startup has made significant progress in this regard, having developed two AI chips, Warboy and Renegade (RNGD), designed for specific AI applications. Notably, FuriosaAI has completed testing its RNGD chips, which are optimized for reasoning models, in partnership with LG AI Research and Aramco.

The RNGD chips are expected to be launched later this year, with LG AI Research reportedly planning to integrate them into its AI infrastructure. This development could have significant implications for the AI industry, as FuriosaAI's chips could potentially offer a more competitive alternative to Nvidia's dominant market position.

In a related development, FuriosaAI is reportedly in talks with investors to raise approximately $48 million (KRW 70 billion) in funding, with the aim of completing the fundraise this month. This injection of capital could provide the startup with the necessary resources to accelerate its AI chip development and expansion plans.

The rejection of Meta's acquisition offer and FuriosaAI's decision to focus on its AI chip development strategy underscores the startup's commitment to its vision and independence. As the AI industry continues to evolve, FuriosaAI's decision could have significant implications for the competitive landscape and the development of AI technologies.

Neither FuriosaAI nor Meta responded to requests for comment, with Meta not immediately available to respond outside regular business hours. However, the development is likely to be closely watched by industry observers and investors, given the significant stakes involved in the AI chip market.