This article is based on an article from the Japanese edition of Engadget and was created using the translation tool Deepl.
SoftBank Group (SBG) has officially announced that it will sell its entire stake in Arm to NVIDIA.
According to the announcement, the transaction value is up to $40 billion (¥4.2 trillion). Of that amount, $2 billion will be paid to Arm in cash at signing and $10 billion will be paid to SBG and the SoftBank Vision Fund in cash and $21.5 billion in NVIDIA common stock at closing.
Upon completion of the transaction, SBG and the Vision Fund are expected to hold an aggregate of approximately 6.7 to 8.1% of NVIDIA's outstanding shares (excluding treasury stock). Completion of the transaction is subject to regulatory approval in the U.K., China, the European Union, and the United States, but is expected to take place in approximately 18 months.
SBG acquired Arm in 2016 for about 3.3 trillion yen. President Masayoshi Son's comment that "only 3 trillion yen" was a hot topic. Initially, Son mentioned the possibility of re-listing Arm independently, but he commented on the circumstances that led to the transaction to NVIDIA;
“After reviewing our original plan to re-list Arm as a stand-alone company and the combination with NVIDIA, we concluded that the latter would enable us to realize more of Arm's potential and enhance our shareholder value. The combination of Arm, the world's most popular computing platform, and NVIDIA, a leading AI computing company, will create a computing company that leads the world in the AI era, and we expect to grow its business into a large, high-growth market.”
In the aftermath of the coronavirus disaster, Son, who rushed to cash out the stock holdings because "collecting cash is the key to protection," will receive half of the $40 billion in this deal in the form of NVIDIA common stock instead of cash.
Arm's open-licensing model continues
NVIDIA also released a statement saying that while Arm will be part of NVIDIA, it will continue to operate the Arm open-licensing model and will maintain and expand the Arm brand.
NVIDIA already has a strong influence in the computing field, including AI, GPUs, and automated driving. The company's acquisition of Arm, whose architecture is used in nearly every smartphone in the world and is increasingly being used in PCs and data centers, is likely to increase its influence in this area.
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This article is based on an article from the Japanese edition of Engadget and was created using the translation tool Deepl. The Japanese edition of Engadget does not guarantee the accuracy or reliability of this article.