Meituan wholly acquires Lightyear Beyond, Wang Xing takes over from Wang Huiwen to lay out the big model
July 4th, 2023

Meituan announced that on June 29, 2023, it wholly acquired 100% of the equity of "Light Years Away" for total consideration consisting of $233.67 million in cash + assumption of $366.94 million in debt + RMB1, totaling approximately RMB2.065 billion.

Prior to the acquisition, Lightyear Beyond had total net cash of approximately $285 million.

Light Years Beyond is an AGI (General Artificial Intelligence) company founded by Huewen Wang, co-founder of Meituan. In February, after ChatGPT ignited the big model market, the retired Huewen Wang announced that he was stepping out to groove into the big model.

Light Years Away is one of the most talked about big model startups in the Chinese AI market. But over the weekend, the soul of Lightyear Beyond, Huiwen Wang, was revealed to be hospitalized due to illness, and thus withdrew from the day-to-day management of Lightyear Beyond. This not only surprised many practitioners, but also raised concerns about the future of Lightyear Beyond.

Just less than a week later, Lightyear Beyond has found its latest home. This is perhaps the best ending for both Wang Huiwen and Lightyear Beyond.

And for Meituan, it will leap into a very competitive force in the wave of big domestic models after bringing a gradually assembled team of mature AI talent under its wing.

  1. Meituan wholly acquired, Wang Huiwen exited

Prior to this, there was very little information disclosed outside of Lightyear, except for the "heroic post" from Wang Huiwen.

The announcement of Meituan disclosed the equity structure of Lightyear.

Qimai is an investment holding company wholly owned by Wang Xing, chairman and CEO of Meituan, with a 0.43% stake, Sequoia China with a 2.44% stake, and other investors with a total stake of 20.41%.

The identity of the other investors was not disclosed in the announcement. However, on June 5, Lightyear Beyond was revealed to have received the latest round of financing of $230 million, in which Source Capital led the investment of $80 million, Five Sources Capital invested $40 million, Suhua invested $40 million in his personal capacity, and Tencent bet $50 million, but the amount of financing was denied by Wang Huiwen.

According to information from the Meituan announcement, the acquisition agreement contains two main parts.

The first is an offshore share redemption agreement. Meituan's cash acquisition is primarily for payment to investors outside of Lightyear. Specifically, it includes zero consideration to AI Age, $5 million to Qimai, $28 million to Sequoia China, and $200.673 million to other investors.

The second is an inbound equity transfer agreement. According to the agreement, Huiwen Wang will sell 100% of the equity interest without any liens. The main asset outside of the inbound Lightyear is its equity interest in First Class Technology, which it acquired in April 2023.

For this, Meituan is required to pay a nominal amount of RMB 1 to Wang Huiwen and assume the debt outside of Lightyear, totaling RMB 366.92 million.

After the acquisition, Meituan owns 100% of Lightyear Beyond and Wang Huiwen no longer retains any rights.

  1. Reasons for Meituan's acquisition

In the announcement, Meituan did not mention the personal physical reasons of Wang Huiwen, which was speculated.

On the afternoon of June 25, after the media exposed that Wang Huiwen was hospitalized due to illness, Lai Binqiang, the former HRD of Meituan, said in his circle of friends that he was accompanying Wang Huiwen in the hospital and said that please rest assured that he would need to follow the medical advice for the next period of time to recuperate and recover, and that everything would be fine.

Lai Binqiang is one of the founding team members of Meituan, is also the first HRD (human resources director) of Meituan, or Wang Xing's high school classmates, he and Wang Huiwen, Wang Xing three personal friendship is very deep. Later that day, Meituan also announced on the Hong Kong Stock Exchange that Wang Huiwen had applied to resign as a director of Meituan for "personal health reasons". Previously, Wang Huiwen had been transferred from an executive director to a non-executive director of Meituan.

On "instant", Wang Huiwen's dynamic stays in a job posting released on May 5, which mentions that the company is recruiting crawlers, data, front-end, back-end, product interns.

As for the reason for the acquisition, Meituan firstly affirmed in the announcement that Beyond Lightyear's position in the field of AGI in China and its management and technical team have high level experience in developing deep learning frameworks.

By acquiring leading AGI technology and talent, Meituan has the opportunity to strengthen its competitiveness in the fast-growing artificial intelligence industry and better fulfill its mission of "helping people eat better and live better".

The acquisition of Light Years Away is not Meituan's first attempt at a large model. Previously, Leopard Change reported that Meituan's big model was almost simultaneous with Wang Xing's investment in Wang Huiwen's company.

The S-team, the highest decision-making body headed by Wang Xing, is extremely concerned about the big model within Meituan. Wang Xing would ask the head of the algorithm team about the progress of the big model about every week or two. The company has been expanding its algorithm team and has started planning for a separate "platform department" to help the group's big model get off the ground in a concrete commercial form. on the afternoon of May 18, the group held a big model technology sharing session with almost all of the internal decision-making body, the S-team, participating.

Large manufacturers have an inherent advantage in doing big models. Linear Capital senior director Bai Zerin told "Azi Lightyear", "The big factories have their own data and scenarios, and for startups in the base layer of the big model, in addition to the engineering landing capability, they need to accumulate enough high-quality data and applicable scenarios to compete with the big factories."

After the completion of this acquisition, it is still unknown how the big model team and light years away will divide the work again within Meituan, but at this moment for Meituan, the road of big model is just like a tiger with wings.

  1. Light years beyond the starting gun of the big model venture

Wang Huiwen's big model adventure journey began with a dinner party on February 10, 2023.

At that time, he had a dinner date with Zhifei Li, the founder of Go out Ask, and two partners of Zenith, Yusen Dai and Yuan Liu.

At the dinner table, talking about this wave of AI, Wang Huiwen directly invited Li Zhifei to join hands in the big model. Li Zhifei gave Wang Huifei an account about the basic investment of AI big model: $20 million for computing power, $20 million for people, and $10 million for data - later the widely circulated "$50 million" was calculated in this way. This is how the much-talked-about "$50 million" was calculated.

When talking about the rise, Wang Huiwen picked up the phone, published that "AI declaration" - "my AI declaration: 50 million dollars, with capital to join the group, do not care about the position, salary and title, seeking team. "

Two days later, Wang Huiwen released the idea of creating a large model company beyond light years: at 9:10 a.m. on February 13, Wang Huiwen posted a recruitment post on the AI Hero List immediately, saying that he wanted to "build China OpenAI".

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