Can Nvidia pull off its ARM acquisition bid?
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Nvidia seems to be interested in acquiring the company behind the CPUs that power most of the smartphones, ARM. Acquiring the British chipset maker is an ideal opportunity for Nvidia as the company that makes one of the most powerful graphics processors, needs a general processor chip for all its graphics cards and ARM specializes in these chipsets. In case this deal goes through, Nvidia could become self-reliant.
It is reported that Nvidia has already approached Softbank to show interest in the British company. Softbank, on the other hand, has been looking to raise funds during these testing times and is considering options like offloading some parts or selling the company entirely. To recall, SoftBank acquired ARM for $32 billion in 2016. Additionally, Softbank is also mulling the idea of stock listing.
While Nvidia has funds and can raise debt, in case required, acquiring ARM would not be an easy task. Since ARM provides CPU designs to leading chipmakers like AMD, Qualcomm, Snapdragon, Samsung and more, this deal could give Nvidia an unfair advantage over its competitors.
The acquisition also could put Nvidia in the drivers’ seat to control the future of smartphones and in case it decides to limit its competitors’ access to ARM’s technology, it could spell doom for all the other companies. Hence the transaction, if it comes through, may be subject to significant regulatory scrutiny.
Aside it has been reported that SoftBank, which is under severe pressure to reduce the gap between its holdings, is also not very keen in going ahead with Nvidia due to the regulatory challenges. The Japanese tech giant is said to have approached Apple to check its interest in ARM. Even though Apple uses a fair amount of ARM’s technology in its smartphones and despite its recent announcement regarding future MacBooks using ARM-based chipsets, the company hasn’t shown much interest in the deal.
While odds seem to be against it, however, in case Nvidia can somehow crack the deal then obviously it could be its most important acquisition yet and could be the biggest ever of a semiconductor company.