NVIDIA to Buy Arm for $40 Billion

NVIDIA announced that it will acquire Arm from SoftBank in a deal that is valued at $40 billion. The firm will pay $21.5 billion in stock, $12 billion in cash, and $2 billion at signing, and SoftBank could receive an additional $5 billion if Arm meets certain performance targets. Also, Nvidia will issue $1.5 billion in equity to Arm employees.

“We are joining arms with Arm to create the leading computing company for the age of AI,” NVIDIA founder and CEO Jensen Huang wrote in an open letter to employees last night. “Someday, trillions of computers running AI will create a new internet—the internet-of-things—thousands of times bigger than today’s internet-of-people.”

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I was of the mind that NVIDIA would be the ideal non-partisan suitor for Arm, which makes the reference designs for the chips that power virtually all mobile devices and, increasingly, many that end up in cloud computing data centers as well. But that’s even more true than I had imagined: NVIDIA won over critics by pledging to keep Arm as a separate company with open licensing, and it will honor SoftBank’s promises to keep Arm in Cambridge, England, it’s long-time home.

SoftBank had purchased Arm in 2016 for $32 billion, and Amazon, Apple, Huawei, Qualcomm, and Samsung are among its biggest licensees.

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Conversation 12 comments

  • crunchyfrog

    14 September, 2020 - 8:38 am

    <p>Well, this should make the stocks surge a bit today.</p>

  • iantrem

    Premium Member
    14 September, 2020 - 8:42 am

    <p>The deal to keep ARM in Cambridge is only until September 2021 and with a worry that US ownership could harm current partnerships in China, UK media are reporting this isn't going to be a smooth takeover. I think <span style="color: rgb(0, 0, 0);">NVIDIA&nbsp;are going to have to extend a lot of those agreements to make this happen. With everything so up in the air over potential trade deals come the end of the year, I'm not sure how happy they would be to do that.</span></p>

    • melinau

      Premium Member
      15 September, 2020 - 2:42 pm

      <blockquote><em><a href="#574611">In reply to iantrem:</a></em></blockquote><blockquote><br></blockquote><blockquote><em>Quite so. Given a certain Mr Cummings' oft-quoted desire to create UK Tech-giants, UK Gov's supine acceptance of the loss of our only truly world-class player seems a bit strange…</em></blockquote><p><br></p>

  • jeffferguson

    14 September, 2020 - 8:46 am

    <p><span style="color: rgb(0, 0, 0);">"</span><em style="color: rgb(0, 0, 0);">We are joining arms with Arm</em><span style="color: rgb(0, 0, 0);">"</span></p><p><br></p><p><span style="color: rgb(0, 0, 0);">Someone was paid to write that.</span></p>

  • red.radar

    Premium Member
    14 September, 2020 - 9:29 am

    <p>Big strategic win for NVidia. Helps keep them from getting boxed out of data centers as intel and AmD extend integration with their cpu platforms. </p><p><br></p><p><br></p>

  • dbonds

    Premium Member
    14 September, 2020 - 11:00 am

    <p>If Nvidia wasn't a direct competitor to Intel and AMD in the CPU market already, they certainly are now. This will certainly make them a major powerhouse in AI and specialty CPUs going forward.</p>

  • glenn8878

    14 September, 2020 - 11:38 am

    <p>Nvidia will hopefully enable ARM to have more competitive CPU designs. They might even develop and sell their own.</p>

    • joeaxberg

      Premium Member
      14 September, 2020 - 1:03 pm

      <blockquote><em><a href="#574699">In reply to glenn8878:</a></em></blockquote><p>They already do. The Nvidia Tegra ARM processor powers the Nintendo Switch for example. There are many different AI edge devices that use an Nvidia designed ARM processor combined with CUDA GPU cores.</p>

  • brettscoast

    Premium Member
    14 September, 2020 - 12:50 pm

    <p>This is a pretty big deal anyway you cut it.</p>

  • olditpro2000

    Premium Member
    14 September, 2020 - 12:51 pm

    <p><em style="color: rgb(0, 0, 0);">NVIDIA won over critics by pledging to keep Arm as a separate company with open licensing, and it will honor SoftBank’s promises to keep Arm in Cambridge, England, it’s long-time home.</em></p><p><br></p><p><span style="color: rgb(0, 0, 0);">I'm still not convinced that they will continue the open licensing forever…</span></p>

  • nbplopes

    15 September, 2020 - 8:33 am

    <p>I think this is a good move from NVidia. ARM designs need more quality competition.</p>

  • melinau

    Premium Member
    15 September, 2020 - 2:45 pm

    <p>A disastrous move from UK perspective.</p><p><span style="color: rgb(0, 0, 0);">I understand NVIDIA has confirmed is an R&amp;D Centre to remain in Cambridge (where the brains are!). </span>Everything (&amp; everyone) of value will be carted off to USA in short-order, along with the IP. </p>

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