SoftBank’s $66bn sale of chip group Arm to Nvidia collapses

SoftBank’s sale of DKK 66 billion USD of the British chip business Arm to Nvidia collapsed on Monday after regulators in the US, UK and EU raised serious concerns about its effects on competition in the global semiconductor industry, according to three people with direct knowledge of the transaction.

The deal, the largest ever in the chip sector, would have given California-based Nvidia control of a company that makes technology at the heart of most of the world’s mobile devices. A handful of large technology companies relying on Arm’s chip designs, including Qualcomm and Microsoft, had objected to the purchase.

SoftBank will receive a break-up fee of up to $ 1.25 billion. and is seeking to unload Arm through a listed offering before the end of the year, according to one of the persons.

The error is set to result in a management upheaval at Arm, with CEO Simon Segars being replaced by Rene Haas, head of the company’s intellectual property unit, the person added.

The collapse of the deal deprives SoftBank of a major unexpected gain that it would have earned thanks to a boom in Nvidia’s stock price.

The cash-and-share transaction was worth up to $ 38.5 billion when it was announced in September 2020. But the value skyrocketed as Nvidia’s shares picked up speed, reaching a peak value of $ 87 billion. in November last year, before the technological stock market upheaval.

This is a development story. More to follow.

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