Nvidia is Buying Smartphone Chip Designer ARM

Earlier this month, we reported that SoftBank, the British silicon chip ARM’s parent company, had allegedly approached , TSMC, Foxconn, Apple, Qualcomm, and Samsung for acquiring ARM.

According to recent reports, Apple and Samsung have stepped away from the deal. Amongst the three potential buyers, i.e., Nvidia, TSMC, and Foxconn, Nvidia is leading the pack. An exclusive report by UK’s Evening Standard suggests that currently, Nvidia and SoftBank are in the final stages of discussion. A potential deal might emerge by the end of summer.

Since ARM’s intellectual property, including the company’s Reduced Instruction Set Computing (RISC) Instruction Set Architecture (ISA), is used by almost all the tech giants like Apple, Qualcomm, Samsung, Huawei, etc. for their smartphones, it only makes sense that Nvidia acquires its operations. ARM currently claims 90 percent of the silicon market.

Reports disclosed that SoftBank’s CEO Masayoshi Son is demanding a price as high as $52 billion for ARM, which translates in a premium of around $20 billion relative to the $32 billion that SoftBank paid in 2016 to acquire ARM.

If the deal goes through and Nvidia succeeds in taking over ARM, it will be the largest acquisition in the silicon industry. However, experts believe that the acquisition will have a fair share of obstructions and complications. Nvidia might face several regulatory issues that will prove to be a stumbling block.

UK’s administration will not be pleased with the deal since ARM provided a commitment to retain its UK headquarter, and the deal entails moving ARM headquarters out of the region.

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