All of Qualcomm’s plans on Arm
To preserve Arm's neutrality, which is close to listing, the American microchip giant Qualcomm wants to create a consortium of companies and become its main shareholder. All the details
Qualcomm, a US company that produces microchips, intends to buy a stake in ARM and create a consortium that preserves the neutrality of the British microprocessor company in an extremely competitive and enormously valued global market: around 500 billion dollars.
WHAT ARE SEMICONDUCTORS
Semiconductors are components needed to make cars, computers, appliances, smartphones, and similar technological devices, among other things. They are therefore crucial for the future development and competitiveness of economies: it is estimated that their demand will double in the next ten years, as a result of the development of the Internet of Things and 5G connectivity.
WHAT SOFTBANK WANTS TO DO WITH ARM
The Japanese holding SoftBank – also active in the semiconductor sector – intends to list its subsidiary ARM on the New York Stock Exchange, after the failure of the acquisition of the company by Nvidia , a US company that manufactures graphics processors, for 66 billion dollars. Given the importance of ARM in the microchip industry, its listing (IPO, in jargon: stands for “initial public offering”) has nevertheless created concerns about the future ownership of the company.
QUALCOMM'S STATEMENTS
Cristiano Amon, Qualcomm's chief executive, told the Financial Times that the company is interested in investing in ARM, which he calls "a very important asset and will be essential for the development of our industry." Qualcomm is one of ARM's largest customers.
Amon explained to the Financial Times that Qualcomm could ally with other microchip manufacturers and that, if the consortium were "big enough", it could make the final purchase of ARM. “Many companies should participate in order to have a net effect that ARM is independent,” he added.
UK FEARS …
Before being bought by SoftBank in 2016 for a price of 24.6 billion pounds, ARM was listed on the London and New York stock exchanges. The deal was also met with some concern in the UK as ARM – the country's most important and strategically valuable technology company – had fallen into foreign hands. Some British politicians called on the government to buy a large stake in the company.
… AND OF THE ENTIRE MICROCHIP SECTOR
Despite the contrary pressure from the United Kingdom, SoftBank seems to have plans to proceed with the listing of ARM in the United States: the operation could however bring the company under the control of a hostile actor, putting an end to its impartiality. ARM enters into collaboration agreements with other entities regardless of their size and geographic location, explains the Financial Times , and this has led to its intellectual properties being used in the creation of most of the microchips sold in the world.
A CONSORTIUM OF PRODUCERS
Amon's statements could revive the possibility of a consortium of chip makers becoming the main shareholder of ARM. Intel CEO Pat Gelsinger had already said he was available.
Qualcomm was opposed to Nvidia's acquisition of ARM. Referring to the period prior to SoftBank's purchase of ARM, Amon told the Financial Times that “Arm has won everywhere thanks to the collective investment of the entire ecosystem, by companies like Apple, Qualcomm and many others, and this because it was an independent and open architecture in which everyone could invest ".
THE PROBLEMS OF SOFTBANK IN CHINA
Amon added that Qualcomm has not discussed the possibility of investing in ARM with SoftBank. The Japanese conglomerate is currently focused on resolving disputes in China: ARM's local arm, ARM China, is led by Allen Wu, who has had disagreements with SoftBank and who appear to have been removed from office.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/qualcomm-arm-investimento/ on Tue, 31 May 2022 10:04:46 +0000.