Jensen Huang, CEO of Nvidia
Rick Wilking | Reuters
The companies announced on Sunday that chipmaker Nvidia had agreed to buy Arm Holdings, the designer of chips for mobile phones, in a 40 40 billion deal from Softbank. The deal will include વી 21.5 billion in Nvidia stock and 12 12 billion in cash, including 2 2 billion payable upon signing.
Softbank acquired Arm in 2016, its largest ever acquisition, for 31.4 billion in 2016. Arm is known as the designer of architecture used in chips in most mobile phones, including the Qualcomm chips used in most Android phones, as well as Apple’s iPhone. Apple Pal is also planning to shift its Mac computers from Intel chips to arm-based design.
Nvidia, whose chips are widely used to support graphics and artificial intelligence, including self-driving vehicles, promised that it would “continue the open-licensing model of the arm and customer neutrality.”
Softbank bought Arm as an investment in the so-called Internet Th Things – the idea is that wireless connectivity in everyday items such as refrigerators, cars and other appliances will lead to useful new circumstances.
“This is the company I have always admired for the last 10 years … this is the company I wanted to be a part of Softbank. I am happy,” Masayoshi Son, chairman of Softbank at the time, told reporters.
However, Softbank’s financial situation has deteriorated this year as the company has lost money on investments it has made in companies such as VWork and Uber. Most recently, the company’s shares have lost value as it is being reported that it has taken some big stakes in the tech giants, which have lost share market value in early September. It is unclear how much money Softbank will actually make on the sale, as it has invested heavily in the arm since the acquisition.
The company is also looking for cash to help start-ups invested by its Vision Fund, many of which have struggled during the coronavirus epidemic and subsequent lockdown. Earlier this summer, it announced that it would sell its stake in T-Mobile for up to 21 21 billion.
Nvidia, meanwhile, is in tears, thanks in part to the boom in video games due to the epidemic. This week, it will launch a new graphics card for PC that shows promising performance for PC gamers. The company had projected a growth of about 46% in the third quarter in its last earnings report.
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