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Last week news surfaced that graphics processing unit (GPU) designer NVIDIA Corporation (NASDAQ:NVDA) was interested in acquiring British semiconductor designer Arm Ltd. Arm, which is currently owned by the Japanese conglomerate Softbank Corp. is responsible for laying the foundation of central processing units found inside smartphones and other environments. Softbank acquired Arm in 2016 for $32 billion and the bank has been rumored to be interested in liquidating its ownership in the design house.
Now, following the earlier report that was courtesy of Bloomberg, the publication is back today with another report suggesting that talks between the two companies have moved forward.
NVIDIA Is Now The Only Party Interested In Acquiring Arm Reveals Report As It & Softbank Look To Speed Up The Process
As opposed to last week's report which claimed that multiple companies were interested in acquiring the British design house, now it's revealed that NVIDIA is the only party that is currently interested to go the full mile with the Arm acquisition. The details reveal that both parties are interested in finishing up the entire process over the next couple of weeks, and NVIDIA's exclusivity in the affair is not final with Softbank also reported to be considering other options should talks with the GPU designer not follow through.
Additionally, even as both NVIDIA and Softbank are eager for a speedy deal, the negotiations are far from being concrete as they carry with them the potential to fall apart at this point believe Bloomberg's sources. Cupertino tech giant Apple Inc has also been contacted by Softbank for the acquisition, but the company has not expressed any interest in going ahead with the deal.
Talks of the deal come at a time when economies all over the globe are reeling from the impact of the devastating coronavirus pandemic. Softbank has been in muddy waters as well as it has been actively dealing with scandalous startups in its portfolio.
Apart from NVIDIA, today's report does not mention any other companies that are as strongly interested in acquiring Arm as the GPU designer. Arm's designs are at the heart of billions of gadgets all over the globe, with high profile tech names such as Apple, Qualcomm and Huawei using the company's reduced instruction set computing (RISC) instruction set architecture (ISA) for their products. Qualcomm's entire portfolio of smartphone processors uses Arm's intellectual property, with the same applying for both Apple and Huawei.
Apple intends to take things one step further as it has publicly confirmed plans of announcing a MacBook notebook running on a central processing unit (CPU) that uses Arm IP. The move is widely seen as a threat yo Intel Corporation whose processors have featured on low and high-end notebooks since 2006 – when Apple made the shift from International Business Machines' (IBM) PowerPC processors that were also based on the RISC ISA.
Another option for Arm, should the deal with NVIDIA fall apart, is listing itself on the stock market for an initial public offering (IPO). Softbank's decision to divest the chip designer appears to be final and an IPO will be one of the few options that the conglomerate will have in removing another company from its portfolio.
NVIDIA has recovered all of its lost market value on the stock market following the devastating crash earlier this year. The company's decision to expand its products to cater to the lucrative data center business has played well in its favor, and it also hopes to gain a strong foothold in the automotive sector which is looking for products that enable self-driving cars. This market has piqued the interest of other tech giants including Qualcomm Incorporated, Tesla Inc and even Amazon, who acquired autonomous driving startup Zoox for a reported price tag of $1.2 billion late last month.