Groq Investors Sue Over Nvidia’s $20 Billion Asset Deal Without Stockholder Vote
Updated
Updated · CNBC · Oct 5
Groq Investors Sue Over Nvidia’s $20 Billion Asset Deal Without Stockholder Vote
3 articles · Updated · CNBC · Oct 5
Summary
Two former Groq engineers who still held shares sued in Delaware on Oct. 2, alleging Groq’s board sold key assets to Nvidia without the stockholder vote required under Delaware law.
The complaint says the $20 billion transaction undervalued what Nvidia bought, with $17 billion assigned to a supposedly non-exclusive license and $3 billion in Nvidia RSUs earmarked for Groq employees who joined Nvidia.
About 150 to 200 Groq engineers moved to Nvidia, along with founder Jonathan Ross, President Sunny Madra and other senior leaders, even as Groq said it would remain an independent company.
The plaintiffs also allege a conflicted board structure let investment funds tied to Groq directors reap windfall returns while other stockholders were squeezed out by billions of dollars.
Groq called the lawsuit meritless and said the Nvidia licensing agreement delivered exceptional value; Jensen Huang had told employees Nvidia was licensing Groq IP and talent, not acquiring the company.