NVIDIA Reportedly In "Advanced Talks" About Acquiring ARM From Softbank

Andrew Cummings
August 2, 2020

We first heard reports that Nvidia was interested in purchasing CPU designer Arm a couple of weeks ago, and according to the latest news, those talks are indeed progressing.

Buying Arm may pay significant dividends for Nvidia as well. As SoftBank seems to repay its rising pile of debt with a view to appease uneasy buyers, a sale of ARM at its peak may assist bolster the Japanese know-how conglomerate's funds.


NVIDIA's decision to procure and bring ARM under its wings will both undoubtedly and very obviously draw ire and varying levels of scrutiny from others in the technology industry; beside NVIDIA, the brand is also a primary, if not the major supplier of chips to tech giants. The company amidst the acquisition discussion is a very critical and important player in a modern-day world that's full of electronics that run on silicon chips and processors.

SoftBank bought ARM in 2016 for $31 billion, and ARM has only grown in value since then as its designs have become more and more integral to Android and iOS devices alike.


"With Nvidia's low-priced fabless model enabling it to focus on R&D, engineering and programming, the fit with Arm would be flawless", said Neil Campling, an analyst at Mirabaud Securities. Nvidia has used its dominance of high-end graphics chips used by gamers to move into new areas such as artificial intelligence processing for data centers.

Under the plan the group has been selling down core assets including stakes in Chinese ecommerce giant Alibaba Group Holding BABA.N and USA wireless carrier T-Mobile US Inc TMUS.O . Interestingly, it was these and a few other concerns that resulted in SoftBank, a neutral company, buying ARM the last time it was for sale.


Arm now has a market share of about 5% for chips used in data centers. The chip-design company could go public as soon as next year if SoftBank decides to proceed with that option, people with knowledge of the matter have said. I could imagine Arm being worth more than $40 billion. Nvidia is now worth around $260 billion, surpassing Intel. Nvidia's market value has increased to nearly US$260 billion in that time, surpassing Intel Corp.

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