NVIDIA, the company known for GPUs, is reportedly interested in acquiring ARM, one of the leading semiconductor or chip designing company. As per the Bloomberg report, NVIDIA has approached ARM for a potential deal.
It is also being reported that some other bidders may also emerge during the process. The development comes just weeks after it was reported that SoftBank, which owns ARM, is planning to all the stake or part of a stake in a private deal.
The report further adds that there’s a possibility that the acquisition bid by NVIDIA may not materialize and ARM could opt to get listed publicly. If the acquisition goes through, then it could be the biggest-ever in the chip industry.
NVIDIA has already established its dominance in the graphics chipset market, which is mostly used for gaming and AI processing. It also has found a new use case in the self-driving car market but it is still nascent.
The acquisition of ARM by NVIDIA could be a major threat to the likes of Intel and Qualcomm and most other chipset makers as almost all of them license ARM’s technology for their own chips. It’s noteworthy that ARM’s technology is the core of Apple Silicon which will be powering future MacBooks.
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For those who are unaware, ARM, which is based in the United Kingdom, was acquired by SoftBank and SoftBank Vision Fund for about $32 billion in 2016. Also, earlier this month, NVIDIA had briefly surpassed Intel in terms of market value.
SoftBank has been selling off assets to endure the COVID-19 pandemic. ARM also recently offloaded two Internet of Things groups to SoftBank to narrow its focus. Selling off ARM could help the Japanese giant to focus on other important businesses.
Even if both the companies reach a deal for acquisition, the transaction will likely face very close and strict scrutiny from the regulatory bodies. Its competitors would likely oppose the deal on the terms of fair treatment.
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