NVIDIA Confirms Acquisition of Key Chip Designer ARM For $40 Billion


NVIDIA, the American company known for its GPUs in computers formally announced the acquisition of ARM.

ARM, the British semiconductor design company owns the core designs that are used on chips like Apple A series, Snapdragon and the rest.

ARM was previously bought 4 years ago by the Japanese company, SoftBank Group for around $32 billion. SoftBank agreed to sell it to NVIDIA for $40 billion, which gives SoftBank a tidy profit for their asset.

The tech giant will pay SoftBank a total of $21.5 billion in NVIDIA common stock, $12 billion in cash, 5 billion in cash or common stock and $1.5 billion in equity to ARM employees. NVIDIA says they intend to finance the cash portion with balance sheet cash.

NVIDIA has plans for their new purchase which is a key force in the world of electronics. The company wants to unite its leadership in AI with ARMs vast computing system for all. They will also expand ARM’s R&D presence in Cambridge UK by establishing a world class AI research and education center and an NVIDIA powered AI supercomputer.

“AI is the most powerful technology force of our time and has launched a new wave of computing,” said Jensen Huang, founder and CEO of NVIDIA said. “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.

ARM is important for the consumer market since they have an open licensing model for the likes of Apple, Qualcomm and Samsung to use their designs in making their chips. NVIDIA intends to continue ARM’s open licensing model and customer neutrality and furthermore expand ARM’s IP licensing portfolio with NVIDIA technology.

The company said that the proposed transaction is subject to regulatory approvals for the UK, China, European Union and the United States. They expect this to take place in approximately 18 months.

This is such a baller move for NVIDIA and their acquisition of ARM should make other chip makers worried for their move to own this key company. The acquisition also comes after the company announced new 30 series Ampere GPUs that provide a huge performance boost compared to the previous 20 series Turing GPUs.