Nvidia is said to be negotiating with Arm to acquire a large stake in the company following an IPO. This reports Financial Times based on sources.
According to the British business newspaper, Arm wants Nvidia to become the main shareholder in the chip technology company after a possible IPO. This IPO is said to be planned for the month of September by current owner SoftBank.
At the moment, negotiations would mainly focus on Nvidia’s entry point as a major investor in the Arm to be spun off. Nvidia would like to step in at a share value that puts Arm’s total value at between 32 billion euros and 36 billion euros ($35 billion to $40 billion). Arm itself is thinking more along the lines of over $80 billion.
Bold move by Nvidia
Nvidia’s possible move can be called quite bold, as the company previously saw a takeover of Arm for about $66 billion last year be blocked by regulators. Nvidia was denied permission for the acquisition by key regulatory bodies such as the EU and those in the UK.
Among the reasons cited by the various regulators for refusing the acquisition was that it could potentially limit access to Arm technology by other chip makers. This could drastically harm competition between them.
Incidentally, it is not only Nvidia that will get a significant stake in the corporatized Arm. According to Financial Times sources, the plan is for other manufacturers, such as Intel, to take a stake in Arm as well.
CEO SoftBank personally involved
In addition, the investments in Arm are said to be intended to make up for Japanese parent company SoftBank’s reduced stake in the post-IPO independent company. CEO Masayoshi Son himself is said to be personally involved in the negotiations with Nvidia and other companies.
Furthermore, the investments should ensure that Arm can continue to grow on its own after the IPO, writes the Financial Times.