Jensen Huang, CEO of Nvidia
Rick Wilking | Reuters
Chipmaker Nvidia agrees to buy Arm Holdings, a mobile chip designer SoftBank in a $ 40 billion deal, the companies announced Sunday. The deal will include $ 21.5 billion in Nvidia shares and $ 12 billion in cash, including $ 2 billion payable at the time of signing.
Softbank acquired Arm in 2016 for $ 31.4 billion in 2016 in one of its largest acquisitions ever. Arm is best known as the designer of an architecture used in brands on many mobile phones, including the Qualcomm chips used in many Android phones, as well as the Apple iPhone. Apple is also planning move Macs from Intel chips in Arm based design.
Nvidia, whose chips are widely used to support graphics and artificial intelligence applications, including motor vehicles, has vowed to “continue Arm’s open licensing model and customer neutrality.”
SoftBank bought the Arm as an investment in the so-called Internet of Things – the idea that wireless connectivity between everyday objects such as refrigerators, cars and other appliances would lead to useful new scenarios.
At the time, Softbank chairman Masayoshi Son he told reporters“This is a company I have always admired for the last 10 years … This is the company I wanted to join SofBbank. I am so happy.”
However, SoftBank’s finances have deteriorated this year as the company has lost money on investments in companies such as We work and Uber. More recently, the company lost value of shares as it was reported that it had received many shares in the tech giants, which suffered a loss in market capitalization in early September.
The company is also looking for cash to help start-ups it invested in through the Vision Fund, many of which struggled during the coronavirus pandemic and subsequent blockades. Earlier this summer announced would sell up to $ 21 billion of its stake in T-Mobile.