Softbank is Selling Arm Holdings to Nvidia for $40B

According to an announcement made over the weekend from both SoftBank and Nvidia, the former will be selling its Arm holdings to the latter for $40 billion.

Softbank’s Arm, which was purchased in 2016 for $31.4 billion, designs the architecture for mobile chips used in almost every mobile device in the world, from the iPhone to just practically every Android device.

The deal will include $21.5 billion in Nvidia stock and $12 billion in cash, including $2 billion payable at signing.

Nvidia said it expects the deal to take about a year to close and has said that it would “continue Arm’s open-licensing model and customer neutrality.” Arm’s operations will remain in the United Kingdom.

“This combination makes financial sense, and it’s a great deal for SoftBank and us,” Nvidia CEO Jensen Huang said on Monday.

“AI is the most powerful technology force of our time and has launched a new wave of computing,” said Huang in a press release.

“In the years ahead, trillions of computers running AI will create a new internet-of-things that is thousands of times larger than today’s internet-of-people. Our combination will create a company fabulously positioned for the age of AI. Simon Segars and his team at Arm have built an extraordinary company that is contributing to nearly every technology market in the world. Uniting NVIDIA’s AI computing capabilities with the vast ecosystem of Arm’s CPU, we can advance computing from the cloud, smartphones, PCs, self-driving cars and robotics, to edge IoT, and expand AI computing to every corner of the globe.“

This combination has tremendous benefits for both companies, our customers, and the industry. For Arm’s ecosystem, the combination will turbocharge Arm’s R&D capacity and expand its IP portfolio with NVIDIA’s world-leading GPU and AI technology.”

“Arm will remain headquartered in Cambridge. We will expand on this great site and build a world-class AI research facility, supporting developments in healthcare, life sciences, robotics, self-driving cars and other fields. And, to attract researchers and scientists from the U.K. and around the world to conduct groundbreaking work, NVIDIA will build a state-of-the-art AI supercomputer,powered by Arm CPUs. Arm Cambridge will be a world-class technology center,” added Huang.

“NVIDIA is the perfect partner for Arm,” said Masayoshi Son, chairman and CEO of SBG.

“Since acquiring Arm, we have honored our commitments and invested heavily in people, technology and R&D, thereby expanding the business into new areas with high growth potential. Joining forces with a world leader in technology innovation creates new and exciting opportunities for Arm. This is a compelling combination that projects Arm, Cambridge and the U.K. to the forefront of some of the most exciting technological innovations of our time and is why SoftBank is excited to invest in Arm’s long-term success as a major shareholder in NVIDIA. We look forward to supporting the continued success ofthe combined business.”

“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 ofArm. “Delivering on this vision requires new approaches to hardware and software and a long-term commitment to research and development. By bringing together the technical strengths of our two companies we can accelerate our progress and create new solutions that will enable a global ecosystem of innovators. My management team and I are excited to be joining NVIDIA so we can write this next chapter together.”

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.