Nvidia reportedly looking to acquire ARM

Nvidia reportedly looking to acquire ARM

Arm designs and licenses the ARM chip architecture that Apple uses in its A-series system-on-chips (SoCs).

SoftBank, led by billionaire Masayoshi Son, is exploring options to sell part or all of its stake in Arm through a private deal or public stock listing, Bloomberg News reported this month.

Will Nvidia end up purchasing ARM Holdings?

There is bound to be wider interest in the acquisition of ARM, which has grown from tiny roots of the Advanced RISC Machine processor inside 1980s BBC and Acorn machines into one of the biggest technology companies in the world, still based in Cambridge, UK. ARM is the supplier of processor architecture to Apple and this has helped the company pioneer the smartphone market and it is now applying the architecture to its laptop computers (see More details emerge of Apple's eviction of Intel processors from PCs).

Softbank Group paid $32bn for ARM back in 2016 in the hope of leveraging IoT to greater revenue and profits. The Bloomberg reports states that such a transaction will not work well with Apple's business model. But now Nvidia has broadened its business into self-driving cars and AI data centers and is now valued at close to $250 billion. Apple did not immediately respond to Reuters' request for comment.

Still, the Cupertino, California-based technology giant has a vested interest in the fate of Arm.

SoftBank has been selling off assets to endure the COVID-19 pandemic. It's also under pressure from Paul Singer's activist investment firm Elliott Management Corp., which has called on the company to boost stockholder value through buybacks and governance changes. The two companies worked out a plan to increase spending on chip designs and on new hirings essentially expanding and investing in the company before slowing down the process ahead of returning to the public stock markets.

Any customer trying to acquire Arm would trigger regulatory scrutiny.

A potential sale to Nvidia or another copany would not likely have a major impact on Apple or Apple's licensing of Arm technology because of the regulatory oversight and requirements that would accompany such a deal. This was what allowed SoftBank, which was considered relatively neutral in the space, to acquire the company the last time it was for sale.

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