Nvidia has confirmed that it will be acquiring chip-maker Arm from Softbank for USD 40 billion. The deal will include USD 21.5 billion in Nvidia stock and USD 12 billion in cash, including USD 2 billion payable at signing. Nvidia will also issue $1.5 billion in equity to Arm employees.
The deal will see SoftBank and the USD 100 billion Vision Fund, which has a 25% stake in Arm, take a stake in Nvidia between 6.7 percent and 8.1 percent. Nvidia’s purchase of Arm also marks the exit of Softbank, which had bought the chip-making company for USD 32 billion in 2016.
Arm is known for designing the underlying architecture of mobile processor chips, including for companies like Apple, Samsung, and Qualcomm. The company is also confirmed to power Apple’s Mac lineup.
Nvidia began as a graphics chip designer and has expanded into products for areas including artificial intelligence and data centres.
The Nvidia-Arm deal would bring Nvidia’s technology through ARM’s network. As part of NVIDIA, ARM will continue to operate its open-licensing model while maintaining the global customer neutrality.
Nvidia will build on Arm’s R&D presence in the UK, establishing a new global centre in AI research at Arm’s Cambridge campus. It will also invest in an Arm-powered AI supercomputer, training facilities for developers and a startup incubator, which is said to attract the world’s research talent and create a platform for innovation and industry partnerships in fields such as healthcare, robotics and self-driving cars.
“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 UK 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 centre,” Nvidia said in its statement.
The proposed Nvidia-Softbank translation of Arm is subject to customary closing conditions, including the receipt of regulatory approvals for the UK, China, the European Union and the United States. Completion of the transaction is expected to take place in approximately 18 months.