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Nvidia (Huida) and SoftBank Group Corp. announced that they have reached a final agreement under which Nvidia will spend $ 40 billion to acquire Arm Limited from SoftBank Group and SoftBank Vision Fund (the two are collectively referred to as “SoftBank”) Company; The transaction is expected to immediately increase Nvidia’s non-GAAP gross profit margin and non-GAAP earnings per share.
Nvidia noted that this acquisition will combine Nvidia’s industry-leading AI computing platform and Arm’s vast industrial ecosystem to create a leading computing company in the AI era. As you accelerate innovation, you will expand your scale to enter a large, high-growth market. SoftBank will continue to use its Nvidia stake (expected to be less than 10%) to commit to Arm’s long-term success.
Huang Renxun, founder and CEO of Nvidia, said that artificial intelligence is the most powerful technological force in the contemporary era, unleashing a new wave of computing; In the next few years, trillions of computers running artificial intelligence will create a new Internet of Things (IoT). The scale is thousands of times larger than today’s Internet of People. The integration of the strengths of Nvidia and Arm will create a company that will stand its ground in the age of AI. He also noted that Simon Segars and his team at Arm have built an outstanding company that has contributed to nearly every technology market in the world. By combining Nvidia’s AI computing power with Arm CPU’s huge industrial ecosystem, you can drive computing power from cloud computing, smartphones, personal computers, autonomous vehicles and robots to the Internet of Things on the edge. , and expanding AI computing to all corners of the world. A corner.
Huang Renxun further stated that the two powerhouses have come together to bring great benefits to the two companies, Nvidia and Arm, the customer base and the entire industry. For Arm’s industrial ecosystem, this combination will greatly enhance Arm’s research and development capabilities, while using Nvidia’s world-leading GPU and AI technology to expand its IP portfolio. Moving forward, Arm’s headquarters will remain in Cambridge, England, and will expand the scale of operations there to create a world-class AI research institution to assist in the development of medicine, life sciences, robotics, vehicles. self-employed and other fields. In order to attract researchers and scientists from the UK and around the world for groundbreaking research, Nvidia will build a next-generation AI supercomputer equipped with an Arm CPU. Arm’s Cambridge headquarters will become a world-class technology hub.
Sun Zhengyi, President and CEO of Softbank Group, said that Nvidia is a perfect partner for Arm. Since acquiring Arm, Softbank has always kept its promises and invested heavily in people, technology and R&D to expand the company’s business reach and enter the market with high growth potential. The new field. Cooperate with the world’s leading technology innovation companies to create exciting new development opportunities for Arm. This compelling combination of Nvidia and Arm puts Arm, Cambridge and the UK at the forefront, creating one of the most exciting technological innovations of this generation. This is why SoftBank is very excited to be a major Nvidia shareholder. , You are committed to investing in Arm’s long-term success; I sincerely hope that the two parties will support the continuation of their business achievements after the business combination.
Simon Segars, CEO of Arm, said Arm and Nvidia share a common vision and enthusiasm for using ubiquitous high-performance computing technology to solve the world’s most pressing problems, including climate change and healthcare, from agriculture. even education. The company needs to adopt new hardware and software and make a long-term commitment to R&D to make this vision a reality. Combining the advantages of both parties in technology can accelerate the pace of progress and propose new solutions to create a global innovator. The management team is very happy to join Nvidia and write a new page for the industry together.
In terms of its commitment to Arm and the UK, after joining Nvidia, Arm will continue its open license model while maintaining global customer neutrality, which is the foundation of the company’s outstanding achievements in the past. So far, companies that have obtained Arm’s authorization have shipped 180 billion chips. Arm partners will also benefit from the products of the two companies, including many innovative products from Nvidia. SoftBank and Arm will make every effort to fulfill the commitments made when SoftBank acquired Arm in 2016, and these commitments are expected to be completed in September 2021.
After completing this transaction, Nvidia will retain Arm’s company name and strong brand image, and expand its headquarters in Cambridge. Nvidia will use Arm’s R&D capabilities in the UK to build a global AI research center on Arm’s Cambridge campus and will invest in building a state-of-the-art AI supercomputer equipped with Arm technology, an institution developer training and a new innovation center. Attract the world’s best talent to conduct research here and create an innovative industrial cooperation platform for autonomous, robotic and medical vehicles.
Regarding other details of the transaction, in accordance with the terms of the transaction that have been approved by the board of directors of Nvidia, SoftBank Group and Arm, Nvidia will pay SoftBank a total of US $ 21.5 billion in Nvidia common stock. and US $ 12 billion in cash, including the US $ 2 billion payable at the time of the contract. . At the time of the transaction, the number of shares issued by Nvidia was 44.3 million shares, and the number was calculated based on the average closing price of Nvidia common shares over the last 30 business days.
Additionally, when Arm meets specific financial performance targets, SoftBank may receive up to $ 5 billion in cash or common stock based on its income structure. Nvidia will also issue $ 1.5 billion in stock to Arm employees. Nvidia expects to use the cash from the balance sheet to fund some of the cash transactions. The transaction does not include Arm’s IoT services business group. The proposed transaction is subject to customary closing conditions, including obtaining permission from regulatory agencies such as the United Kingdom, China, the European Union, and the United States; The transaction is expected to be completed in approximately 18 months.
(This article is reprinted with permission from MoneyDJ News; source for first image: Nvidia)
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