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Qualcomm raises prospect of an Arm consortium – report

Qualcomm raises prospect of an Arm consortium – report

Business news |
By Peter Clarke



Leading fabless chip company Qualcomm has said it wants to buy a stake in Arm, alongside rivals, to maintain the processor intellectual property licensor’s neutrality, according to a Financial Times report.

Arm is owned by Japanese holding company SoftBank Group which is planning an initial public offering of shares on the New York Stock Exchange sometime before the end of the current financial year. The IPO is an alternative to a failed plan to sell Arm to Nvidia for about $66 billion (see Analysis: Arm CEO replaced as ‘unwanted’ sale to Nvidia cancelled). The possibility of a consortium coming together to buy Arm was floated as the Nvidia deal was being constructed but failed to gain traction to compete with Nvidia’s offer.

The Nvidia deal was thwarted by resistance from the regulatory authorities. Now Qualcomm would likely invest in the IPO but concerns have been raised that an IPO could still leave Arm susceptible to a hostile takeover.

Consortium

Instead Qualcomm could join forces with other leading licensees to buy Arm outright if the consortium making the purchase was “big enough,” the Financial Times reported Cristiano Amon, CEO of Qualcomm, saying. “[Arm is] a very important asset and it’s an asset which is going to be essential to the development of our industry,” Amon reportedly said.

Some UK politicians have been lobbying for Arm to list on the London Stock Exchange and even for the UK government to insist on a ‘golden share’ in the company to give it a power of veto over some actions.

Amon’s comments come at a time when the UK government has called in the takeover of UK chipmaker Newport Wafer Fab Ltd. by China-controlled Nexperia BV for investigation under national security concerns (see Newport Wafer Fab sale comes under investigation). Reportedly there are discussions that NWF could be sold to a US consortium.

Also a UK parliament committee has opened up a more general inquiry into the state of the semiconductor industry in the UK (see UK government opens inquiry about domestic semiconductor industry).

Related links and articles:

Analysis: Arm CEO replaced as ‘unwanted’ sale to Nvidia cancelled

ARM moves to regain control in China, clear path to IPO

Newport Wafer Fab sale comes under investigation

UK government opens inquiry about domestic semiconductor industry

Arm’s China subsidiary plans its own IPO

ARM sale to Nvidia agreed at $40 billion

Google, Microsoft, Qualcomm object to Nvidia-ARM deal

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