Japan's
Softbank buys semiconductor giant ARM for $32 Billion in Cash
The Japanese
telecom giant which is popularly know as “SoftBank”
has confirmed that the company intends to acquire UK chip designer ARM
Holdings for almost $32 Billion (£24.3 Billion) in an all-cash deal.
ARM has also agreed to this offer from SoftBank and said that its board would
recommend the all-cash deal to shareholders.
SoftBank will pay nearly $22.5 per
ARM share, which is approximately, 43 percent more than ARM's closing share
price on Friday and 41 percent more than ARM's all-time high closing share
price.
The deal is
the largest-ever acquisition of a European technology business, first reported by
The Financial Times.
REASON WHY ARM REALLY WORTH $32
BILLION
Founded in
1990, Cambridge-based ARM Holdings designs microchips for a variety of
smartphones and powers more than 95 percent of the smartphones in the market.
Whether it is Apple's iPhones or iPads, Samsung's Galaxy smartphones, Amazon's
Kindle e-readers, the cheapest Nokia phones or Internet-connected devices like
Nest's smart thermostats, Fitbit's fitness trackers, Canon's EOS cameras,
Ford's cars, and DJI's drones, all are powered by ARM-based chips.
Here’s what ARM chairman Stuart Chambers said about the acquisition:
"This
is a compelling offer for ARM shareholders, which secures the delivery of
future value today and in cash. The board of ARM is reassured that ARM will
remain a very significant UK business and will continue to play a key role in
the development of new technology."
ARM does not
actually manufacture chips, but rather it licenses its semiconductor
technologies to a huge variety of device makers. ARM not only dominates the
market for smartphones but also used in other consumer gadgets, industrial-like
devices and "Internet of things."
So,
SoftBank’s acquisition of ARM Holdings means the Japanese company is buying the
most valuable company in the world of mobile processors.
SoftBank said that ARM Holdings, which currently has 4,064 employees worldwide,
will remain headquartered in Cambridge, and that the company would retain ARM's
senior management team, brand, as well as a lucrative partnership-based
business model.
The Japanese firm has also promised to double the staff headcount in the United
Kingdom over the next five years.
Here’s what SoftBank CEO Masayoshi Son said about the acquisition:
"We
have long admired ARM as a world renowned and highly respected technology
company that is by some distance the market-leader in its field. ARM will be an
excellent strategic fit within the SoftBank group as we invest to capture the
very significant opportunities provided by the Internet of Things."
Son
described the ARM acquisition as "one of the most important"
acquisitions in the history of its Japan-based business.
This is the latest major tech acquisition in last few months. At the beginning
of this month, Antivirus firm Avast acquired AVG Technologies for
$1.3 Billion in cash and last month; Microsoft made its biggest acquisition by buying
LinkedIn for $26.2 Billion in cash.
No part of this content should be copied without a written approval from the author
Title : Softbank Paid $32 Billion To Semi-Conductor Giant ARM
Description : Japan's Softbank buys semiconductor giant ARM for $32 Billion in Cash The Japanese telecom giant which is popularly know as...
