Japan's SoftBank is acquiring ARM Holdings for $31 billion (£24 billion). The British chip design firm dominates the smartphone market, with its lineup of chips used in 95% of handsets today.
SoftBank CEO Masayoshi Son said that ARM would function as an independent business, with an intention to double its headcount in the UK over the next five years:
We have long admired ARM as a world renowned and highly respected technology company that is by some distance the market-leader in its field. ARM will be an excellent strategic fit within the SoftBank group as we invest to capture the very significant opportunities provided by the "Internet of Things".
This investment also marks our strong commitment to the UK and the competitive advantage provided by the deep pool of science and technology talent in Cambridge. As an integral part of the transaction, we intend to at least double the number of employees employed by ARM in the UK over the next five years.
SoftBank intends to invest in ARM, support its management team, accelerate its strategy and allow it to fully realise its potential beyond what is possible as a publicly listed company. It is also intended that ARM will remain an independent business within SoftBank, and continue to be headquartered in Cambridge, UK.
This is one of the most important acquisitions we have ever made, and I expect ARM to be a key pillar of SoftBank's growth strategy going forward.
Unlike traditional semiconductor firms like Intel, ARM does not fabricate its own processors. It licenses the IP for its designs to manufacturers like Qualcomm, Samsung, Huawei, NVIDIA, Microsoft, Apple, and others. Companies can license its Cortex processors, or its chip architecture and design their own CPU, much like the Kryo cores in the Snapdragon 820 that's inside the upcoming Elite x3. The number of devices running ARM-designed hardware has crossed 60 billion last year.
SoftBank is a major investor in the tech space, having acquired stake in U.S. carrier Sprint, China's e-commerce giant Alibaba, India's e-commerce vendor Snapdeal and local ride aggregator Ola Cabs among others in recent years.
Reader comments
It's official: SoftBank is buying ARM for $31 billion
Ms should buy Intel ???
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MS should buy it.
I personally think Intel should have purchased ARM. Just think of Intel's chip producing experts putting their collective ideas into ARM, and vice-versa. I think it would be good for processors in general.
Armpit
Wow!
LinkedIn....
And the "genious" of Nadella bought that s### of LinkedIn for 26B ??? Microsoft could now sell the cpu to Apple!!!! Go home Satya, go home....
Uh, what would MS do with mobile chipsets? Linkedin is within Microsofts business path whereas Mobile hardware is not. ARM will also have more and more competition onwards whereas the software market is easier to stay viable in.
Edit:
I don't think you know what ARM does if you think this buy would mean MS would have sold "cpu's" to Apple.
Alot of people don't know. And they still have this idea that Microsoft is a hardware company. Smh... They complain about the LinkedIn purchase like they have Microsoft any money to borrow. These people sick my stomach with they're comments sometimes.
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Yeah, I guess the word for this is: Clueless
Venetasoft, you do know that Apple has its own chip right...
Yeah, I knew there was a reason Nadella was CEO instead of venetasoft.
What isn't mentioned is that the £24 billion price is some 40% over the share value. That's a serious statement of intent, plus, as a bonus, ARM will remain in Cambridge UK.
billions flying here and there and you can't touch it :(
ARM will leave the sinking Brexit ship. Wise move.
The post doesn't mention it, but SoftBank intends to double the workforce based in Cambridge where ARM is based. So not leaving the country due to Brexit.
As for the subject of Brexit; shame, it sounds you don't have a clue...
Lets see.. UK is about to lose billions of science funding due brexit not to mention red tape on workforce mobility.
What people fail to understand is the money we receive through EU grants is OUR money to start with. We do not get more back than we put in...
I for one am hoping that the science grants currently funded by UK taxpayers via the EU will instead get grants directly from HMG.
As for work force mobility, yes there'll be some extra paperwork but at least we'll have a pool of 7bn people not 500m to choose from.
For example, the UK educates (via private funding) a lot of Chinese scientists and engineers, they are only allowed a limited amount of time to work in the UK after they have completed their degrees then they are forced to return home. I want these people to stay and help build our economy not someone else's...
@vhyr - You have NO idea what all this means... best to shut your trap...
Would have made it cheaper for them to buy because of Brexit though. Devaluation of pound.
This is carrier, not a bank with carrier business?
Bank in a sense that it has so much debt its too big to fail.
Is that so?? Nice...
This would've been a better purchase for Microsoft than LinkedIn.
...why?
Because he had 5 seconds to type some random thoughts.
Perhaps he's wondering why Microsoft bought a loss making website is valued at 26 billion yet the company that holds the keys to 95% of the mobile phone market could have been bought for 31 billion.
I love how some make out the 5 billion difference between 26B to 31B to be small or not that big a deal.
I love how some make out the 5 billion difference between 26B to 31B to be small or not that big a deal.
Because Intel is one of Microsoft's most important partners. Why shouldn’t Microsoft piss them off by becoming a direct competitor?
Well intel just discotinued the mobile chips delaying surface phone. They piss microsoft for sure
Selfishly, I agree. Because I am a fan of Microsoft's hardware and have/continue to want Windows Phone to succeed, I would have preferred them to buy ARM above LinkedIn. Imagine if msft could have kept Nokia's hardware and manufacturing afloat along with the purchase of ARM's IP. Could have been great. I know...but it's fun to dream.
Microsoft is a software company. Not a hardware company.
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Thanks I'm glad you Surfaced that fact.
What a monopoly regulation nightmare you just outlined for Microsoft. How soon we forget the dearth of innovation out of Microsoft the last time they were under the close watch of anti-trust authorities.
Good for them. Intel still can't touch ARM in smartphones.
Doesn't need to.
I guess this has no connections with the upcoming W10M handset Lenovo SoftBank 503LV?
Of course not. It's just a normal corporate strategy..