SoftBank Purchases Mobile Chip Maker ARM for $32 Billion
In one of the largest European tech acquisitions ever, Japanese tech company SoftBank is buying UK-based mobile chip designer ARM for an all-cash deal worth $32 billion. ARM designs the processors used in almost all mobile devices, including ones from Apple, Samsung and HTC.
SoftBank also owns Sprint, which it purchased for $21.3 billion. SoftBank Chairman and CEO Masayoshi Son said in a statement that ARM will be “an excellent strategic fit” for the company as it looks to capitalize on the Internet of Things opportunities as more smart devices and appliances come to market. Son said he had been following ARM for the last 10 years and decided now was the right time to invest in a firm that provides the technology in nearly all smartphones, according to Reuters.
“This investment also marks our strong commitment to the U.K. 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,’’ Son stated.
SoftBank intends to maintain ARM as an independent business within SoftBank, and it will continue to be headquartered in Cambridge, U.K., he 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,” Son added.
While ARM’s board have voted in favor of the deal, it still requires approval from shareholders. If the deal goes through, it will be the first major cross-border transaction in Great Britain since the country voted to leave the European Union in June. Son spoke to new British Prime Minister Theresa May over the weekend and soon after the deal was announced, the government released a statement saying this indicated Britain remains open for business, Reuters reported.
ARM’s board was swayed by SoftBank’s promise to increase jobs at the company and its willingness to work with the British government, in addition to paying a 43% premium, according to Reuters.