Rumor has it NVIDIA aims to buy ARM processor architectures developer
NVIDIA is interested in buying a British chip developer, ARM, owned by the Japanese SoftBank Group. This was reported by the Bloomberg resource, citing their informants.
Recently, NVIDIA has hinted at a potential deal to buy Cambridge-based ARM. It is argued that other potential stakeholders could emerge here. SoftBank, led by billionaire Masayoshi Son, is exploring options to sell part or all of its stake in ARM through a private deal or public offering. The latter scenario, however, may not be as attractive for NVIDIA as the purchase of the entire company.
The ARM deal could be the largest purchase in the semiconductor industry, according to data compiled by Bloomberg. ARM is owned by SoftBank and its $ 100 billion Vision fund. The Japanese group bought ARM in 2016 for $ 32 billion, but much has changed since then, and the assets of the British processor developer have clearly risen in price.
Representatives from SoftBank, ARM, and NVIDIA declined to comment.
Since SoftBank acquired ARM four years ago, the PHLX Semiconductor Sector Index, which reflects the average share price of the largest US semiconductor companies, has risen 185%. Investors are pouring money into the industry, hoping for rapid growth, fueled by new markets and technologies such as autopilot for cars and artificial intelligence.
NVIDIA shares jumped eightfold over the same period and are up 76% this year alone to reach $ 254 billion today. The Santa Clara-based California-based company dominates PC gaming graphics and is doing great in new areas like artificial intelligence for data centers, and in the emerging market for systems that will run in autonomous vehicles.
All of this made NVIDIA a significant threat to a wide range of companies, including Intel, Qualcomm, and AMD. All three, interestingly, license ARM technologies. Earlier, in July, NVIDIA even briefly surpassed Intel in market value. Note also that SoftBank previously owned a stake in NVIDIA: in 2017, their volume was estimated at $ 4 billion. But in early 2019, the Japanese firm announced that the Vision fund had sold its entire stake in NVIDIA.
It is worth noting that ARM technologies are now very important (just remember the story with Huawei), so any potential buyer will be subject to a thorough antitrust review by regulators. All parties are extremely interested in the new owner continuing to provide equal access to the ARM instruction set. Such concerns led to the fact that the last time ARM was listed for sale, it was acquired by a neutral company SoftBank.