Nvidia already in advanced talks to buy ARM for more than US$32 billion

A week ago, chatter about a possible ARM acquisition initiated by Nvidia started permeating the media, but many analysts were skeptical this huge deal could actually go through since it would create problems for companies like Apple, AMD, Qualcomm and Samsung who are long-standing clients of the British company. Despite the skepticism, it looks like the acquisition talks are advancing well and Nvidia is even closer to sealing the deal now, as reported by Bloomberg.

The actual value of the transaction in question is still unknown. SoftBank, the current owner of all ARM shares bought the British company for US$32 billion in 2016, so the value is clearly higher now. If Nvidia agrees to pay more than what SoftBank originally paid, this could result in the largest-ever deal recorded in the semiconductor industry. There is no final decision yet, meaning that Nvidia might still pass on the opportunity if no agreement is reached in a timely manner. In this case, SoftBank could decide to pursue an initial public offering for US$44 billion next year, and if a deal is not struck by 2025, ARM could potentially be worth US$68 billion at that point, according to New Street Research LLP.

It is not entirely clear how U.S. regulators are going to allow for the Nvidia-ARM deal to go through. ARM already has a list of big clients including Nvidia itself, and some of said clients are even Nvidia’s direct competitors. These companies may immediately demand assurances that a new owner would continue providing unrestricted access to all ARM’s IPs and licenses. SoftBank did not have this problem back in 2016, since it was viewed as a neutral company.