"Acquiring" is often synonymous with "merger". Technically the surviving company acquires the other, but effectively it's a merger. Not always, but it's not uncommon to see two weaker companies merge in a competitive landscape to survive. It also counts as a liquidity event allowing employees some financial levers.
They probably got what got left of it in a cashless deal. Basically, the shareholders got to exchange X shares in a fatally wounded company into Y shares in a still-alive startup. The economic sense depends on the ratio between X and Y, but if the board was close to panicking due to recent events, Cognition probably got a good deal.
I think google is buying windsurf, they are leaving 100% of assets and some employees, and windsurf is buying that 100m in assets + taking the leftover employee liability.
Microsoft poached the talent, devin Co. Picks up the scraps
"Acquiring" is often synonymous with "merger". Technically the surviving company acquires the other, but effectively it's a merger. Not always, but it's not uncommon to see two weaker companies merge in a competitive landscape to survive. It also counts as a liquidity event allowing employees some financial levers.
But these seem to be two well-funded companies? I.e. both with $100M+ funding within the last 12 months
> How does this transaction make sense?
The fact that it doesn't make sense with those numbers almost surely indicates those numbers are misleading.
> Google paid a $2.4 billion licensing fee
This is the reported number for licensing and compensation, but who knows what the terms really were.
> Cognition’s valuation is $4 billion
Doubtful
They probably got what got left of it in a cashless deal. Basically, the shareholders got to exchange X shares in a fatally wounded company into Y shares in a still-alive startup. The economic sense depends on the ratio between X and Y, but if the board was close to panicking due to recent events, Cognition probably got a good deal.
I think google is buying windsurf, they are leaving 100% of assets and some employees, and windsurf is buying that 100m in assets + taking the leftover employee liability.
Microsoft poached the talent, devin Co. Picks up the scraps