Largest-ever deal in the chip industry could see Nvidia acquiring ARM

ARM is the company behind all those processor cores inside our smartphones, tablets and even some laptops as of late. All those SoCs produced by Apple, Samsung, Qualcomm and MediaTek are designed around ARM’s CPU cores. It is true that ARM also designs GPU cores, but these are not as widely used. This can be regarded as common knowledge at this point. However, a lesser known fact about ARM is that it is currently controlled by the SoftBank Group Corp., a company that not too long ago had a considerable stake with Nvidia. Latest word on the street is that SoftBank is now looking to sell ARM and this could result in the largest acquisition in the chip industry.

Bloomberg reports that Nvidia is now showing the most interest in acquiring ARM, although nothing is set in stone as of yet. SoftBank also approached Samsung (according to KoreaTimes) and Apple for the ARM acquisition, but both companies declined to pursue bids. Apparently, ARM’s licensing operation would fit poorly with Apple’s hardware and software business model, plus any company buying ARM would trigger regulatory scrutiny since ARM is licensing many of its IPs to an entire portfolio of competing companies.

SoftBank bought ARM for $32 billion back in 2016, and the market cap for the British company is now estimated to have increased by 185%. As previously mentioned, SoftBank also owned a $4 billion stake in Nvidia, but the entire stake was sold by 2019. Meanwhile, Nvidia managed to increase its market cap to US$254 billion, briefly surpassing Intel in early July this year. If the deal goes through, Nvidia could prove a serious threat to direct competitors like Intel, Qualcomm and AMD, who continue to be long-standing ARM customers.