UK Chip Designer ARM to Be Acquired by Japan's Softbank for $31.4B

[MacRumors]

British chip designer and major Apple partner ARM Holdings is set to be acquired by Japanese firm Softbank for $31.4 billion, the BBChttp://www.bbc.co.uk/news/business-36822806 has revealed.

According to the report, the board of ARM is expected to recommend shareholders accept the offer, which amounts to a 43 percent premium on its closing market value of $22.2 billion last week.

Shares in the U.K. technology firm surged by 45 percent at the open of the London Stock Exchange this morning on news of the deal, adding $10 billion to ARM's market value.

The Cambridge-based company was founded in 1990 and employs 3,000 staff. The acquisition is said to be the biggest ever purchase of a European technology company, one that will be funded by Softbank's own cash reserves and a long-term loan from Japan's Mizuho Bank. Commenting on the deal, chairman and chief executive of Softbank, Masayoshi Son, said:

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.

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 with the Softbank group as we invest to capture the very significant opportunities provided by the Internet of Things.

ARM designs the processors that power all of Apple's iOS devices, as well as most of Samsung's smartphones, and receives royalties on each chip made to its specifications. Last year over 15 billion ARM-designed processors were shipped, up 3 billion on the previous year.

Softbank is one of the world's biggest technology companies, having previously acquired Vodafone's Japanese operations and U.S. telecoms company Sprint. The latter $20 billion deal was the biggest foreign acquisition by a Japanese firm at the time.

Following the announcement of today's deal, ARM said it would keep its headquarters in Cambridge and double the number of its staff over the next five years. Softbank also intends to preserve the UK tech firm's organization, including its existing senior management structure and partnership-based business model.

Article Link: UK Chip Designer ARM to Be Acquired by Japan's Softbank for $31.4B

 

[canesalato]

Apple should have bought then

 

[maflynn]

Apple should have bought then

People (including me) said the same thing about Nest and I have to admit, it looks like it was a smart move on Apple's part to pass on Nest.

As for this, I'm pretty sure that regulators would have some issues if Apple bought them

 

[MH01]

i thought apple would have bought them.

 

[Santabean2000]

Ch-ching! Payday for someone. FairPlay though, they nailed this market.

 

[maflynn]

I don't get the synergy though, a carrier buying the ARM CPUs, they really don't make phones, so I'm not seeing how it fits in.

 

[Ashwee]

Damn, sold all my shared in ARM in April!

 

[Zirel]

Apple should have bought then

Yeah, Apple should have bought a company that licenses their designs to 99% of Android devices. /s

Like the SEC would allow Tim Cook to do so...

 

[omenatarhuri]

I don't get the synergy though, a carrier buying the ARM CPUs, they really don't make phones, so I'm not seeing how it fits in.

They also previously bought majority of SuperCell, a mobile gaming company. Maybe it's not always about synergy, just diversity and influence.

 

[scaramoosh]

Sucks for the uk, I wish everything would stop leaving for the east. The government should have blocked it because this is only bad news for the London stock.

 

[Benjamin Frost]

I thought Apple should have bought them.

Perhaps they didn't because ARM are too focused on computing.

 

[PlainviewX]

Yeah, Apple should have bought a company that licenses their designs to 99% of Android devices. /s

Like the SEC would allow Tim Cook to do so...

What would this have to do with the FCC? They're a British company. The FCC would have no say.

 

[samcraig]

Dear Apple,

Since we just spent a bucketload of cash, we wanted to alert you that your prices will be going up when we negotiate next.

 

[high3r]

Apple licenses ISA (instruction set) from ARM and they design their own processors (not ARM). Samsung on the other hand is using ARM designed cores and also their own(?) Mongoose core is only a slight modification of ARM's A72 core.

 

[Piggie]

Always makes me smile when I read about ARM making the chips for Apple.
when the Fan's all scream "Apple makes it's own chips from scratch"

 

[Zirel]

What would this have to do with the FCC? They're a British company. The FCC would have no say.

Youre confusing FCC with FTC.

And brit or not, there would be a problem of antitrust if Apple bought ARM.
[doublepost=1468843608][/doublepost]

Always makes me smile when I read about ARM making the chips for Apple.
when the Fan's all scream "Apple makes it's own chips from scratch"

ARM doesn't make any chips.

And Apple does indeed make their own chips from scratch, do you even have a faint idea of what a Instruction Set Architecture is?

 

[teknishn]

ARM doesn't design the processors used in Apples devices. Apple licenses ARM's IP and designs their own highly customized and unique SoC's

 

[Cognomen]

Good that it a Japanese company with the right ethics. SoftBank are keeping all the management and staff and probably doubling up one the current headcount. As far as I can see, nothing changes for the moment. Apple still get their chips designed as per the ARM license and, subject to the laws of business, if it ain't broke, don't fix it as can be seen from the steep rise in ARM shares today. The UK is going through a major change but we are still functioning as the (currently) fifth largest economy in the world. The UK might be a small island but we still have things people want - to me that's positive. Much like the Japanese in fact, come to think of it!

 

[MH01]

I thought Apple should have bought them.

Perhaps they didn't because ARM are too focused on computing.

Ha ha ha this post wins.
[doublepost=1468844496][/doublepost]

ARM doesn't make any chips.

And Apple does indeed make their own chips from scratch, do you even have a faint idea of what a Instruction Set Architecture is?

And who produces the chips??

 

[page3]

Apple did own ARM. Well around 33% of it anyway.

Long live Acorn RISC Machines.

 

[Mercifull]

Huge loss to the UK economy to lose this business offshore.

 

[Piggie]

ARM doesn't make any chips.

And Apple does indeed make their own chips from scratch, do you even have a faint idea of what a Instruction Set Architecture is?

Sorry, I did not mean physically make chips, I mean the deep down base design stage.
If you listen to some/many fans here they seem to think Apple starts off from scratch, with a totally blank sheet of paper, nothing designed by anyone else, every time they come out with next years chip.

 

[recoil80]

I thought Apple should have bought them.

They don't design Watch bands so I don't see why Apple should have been interested.

Btw this is not a bad news for UK since ARM is going to stay there, at least for now.

 

[hairydalek]

Thanks, page3

Yes, the A in ARM originally stood for Acorn - a British computer company in the 1980s which created the BBC Micro family of computers. The first commercial range of ARM based hardware was the Archimedes range of computers that Acorn released almost 30 years ago. I have one.

Apple did invest in ARM - and they and Acorn formed an alliance here in the UK to work in the education sector, a move that was referred to as “Fruit and Nut” by some of the wags in the computer press. When Acorn folded, parts went to Pace, and their hardware became buried into set top boxes. ARM by then had been spun out to the company we know now, and Apple was putting their processors in the Newton family of PDAs.

So, not much of Acorn left now. Its spirit lives on in part in the ARM based Raspberry Pi - and there are still versions of Acorn’s RISC OS around that will run on it, should you want the retro feel

 

[Ihatefall]

Good that it a Japanese company with the right ethics.

lol Japan is just good at the cover up. I have lived in Japan for years, Japanese companies don't really have a history of doing the right thing.

Also as a former SoftBank customer I can say that they are the worst IMO of the big 3 in Japan. This probably isn't a good thing for anyone but the people selling.


My guess is that they are going to try to make their own phones in the future. Japanese carriers have a history of that. So much so that each carrier used to have its own unique charge port. You used to have to go to the store and buy a "SoftBank charger" or A "docomo charger". It was ugly