It’s happening: NVIDIA to acquire Arm for $40 billion

NVIDIA and SoftBank Group Corp. (SBG) have announced a definitive agreement under which NVIDIA will acquire Arm Limited from SoftBank for $40 billion. As part of NVIDIA, Arm will continue to operate its open-licensing model. It will operate as a division of NVIDIA and will remain headquartered in the UK. It will “continue to operate its open-licensing model while maintaining its global customer neutrality,” the company said. NVIDIA intends to retain the name and strong brand identity of Arm and expand its base in Cambridge. Arm’s intellectual property will remain registered in the U.K. 

To recall, SoftBank bought Arm for $31 billion four years ago. The undertakings are scheduled to complete in September 2021. Arm’s tech powers mobile device processors for several companies including Samsung, Apple, and Qualcomm. Moreover, Apple recently announced its switch to Arm-based chips for future Macs. On the other hand, Microsoft is making an Arm-based Surface and a version of Windows for Arm. Hence, the British company will likely only increase in value, as it has since SoftBank acquisition.

For reference, NVIDIA doesn’t do much in mobile hardware. However, it is the leading maker of GPUs, and manufactures Tegra line of mobile chipsets used in devices like the Nintendo Switch. The company is positioning the acquisition as setting up the next stage of AI computing.

Bloomberg reports that “Huang said Nvidia is spending a lot of money for the acquisition and has no incentive to do anything that would cause clients to walk away.” The proposed transaction is subject to customary closing conditions, including the receipt of regulatory approvals for the U.K., China, the European Union and the United States. Hence, the deal is likely to face intense regulatory scrutiny.

“Arm and NVIDIA share a vision and passion that ubiquitous, energy-efficient computing will help address the world’s most pressing issues from climate change to healthcare, from agriculture to education,” said Simon Segars, CEO of Arm.

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