Recently, the IT giant Softbank announced that it wanted to sell the ARM chipmaker, which had only been acquired a few years ago. While some analysts think Apple or Samsung is a potential buyer, insiders say NVIDIA has expressed interest. What's behind it?
Softbank's losses force Masayoshi Son to act
It was only in 2016 that Softbank acquired the semiconductor group ARM for the impressive purchase price of $ 32 billion. Now the Japanese conglomerate is looking for a new owner for the chip designer. The background to this is the high losses of the billion dollar Vision Fonds Softbanks in two successive quarters. For this reason, the Masayoshi Son company has already sold shares in the Chinese trading giant Alibaba and the US-American Deutsche Telekom subsidiary T-Mobile US in the past weeks and months. According to Bloomberg, ARM is now to follow. The Japanese are probably considering a partial or full sale - by IPO or private sale.
ARM designs tailor-made chip structures, which are then sold to the respective customer companies under license. The semiconductor smithy then receives a small share for each chip sold. Customers include well-known IT groups such as Apple, Samsung or QUALCOMM. No wonder that it is these companies that are considered potential buyers of ARM.
Apple and Samsung probably aren't potential buyers
However, industry expert Jim Handy of Objective Analysis believes this is unlikely, as he said in an email interview with the Korea Times. In his opinion, a potential selling price of the semiconductor company of an estimated $ 40 billion would simply be too expensive. In addition, ARM's licensing business model would also conflict with Samsung and Apple's business strategies: "It doesn't look like Samsung licensing intellectual property to other companies. [...] Apple is similar. Usually, Apple buys small businesses because of their intellectual property but don't license it to others like ARM does. So I find it difficult to understand why Samsung or Apple should buy ARM, "says Handy.
Does NVIDIA Hit ARM?
As Bloomberg reported with reference to insiders, the graphics group NVIDIA would have expressed interest in the chip maker. Should there actually be a purchase, this would be the largest takeover in the semiconductor segment that has ever existed. For the US graphics card manufacturer, which currently has a market capitalization of approximately $ 250 billion, an ARM acquisition would certainly be an important step in the expansion of its business areas of artificial intelligence or autonomous driving. As Bloomberg reports, ARM is currently endeavoring to increasingly use its semiconductor designs in smart vehicles, data centers and network equipment. So far, however, there has been no official confirmation of the discussions between Softbank and NVIDIA. And even from insider circles, a purchase is definitely not a foregone conclusion.
However, with such a large takeover, it should also be clear that international competition watchdogs will look very closely. And it should also be very interesting for license customers of the semiconductor designer who will become the new owner - after all, Apple, Samsung & Co. could fear that the licenses will become more expensive in the future or that access to new developments will be denied if a competitor should become new owners of ARMs. So it remains exciting who will become the future owner of the semiconductor designer.