In one of the biggest tech deals of the year, SoftBank has announced that it officially closed the acquisition of British chip designer ARM.
SoftBank Buys ARM
According to the website wccftech.com, back in July 2016, SoftBank already stated that it plans to buy ARM Holdings. At the time, SoftBank stated that the deal would total to £24 billion, equivalent to $32 billion USD.
From today, Sept. 6, ARM will be delisted from the London Stock Exchange. The company plans to double its staff over the next five years and it will keep its headquarters in Cambridge.
ARM has stated that all its issued shares have been purchased by ARM for cash. The closing of the deal comes just a couple of days after the acquisition received its final regulatory clearance that is required in case of this kind of transactions. Both companies will start consolidating their financials. Once it is verified, SoftBank will announce the operational and financial impact of the consolidation.
According to tech market analysts, one of the reasons why SoftBank decides to acquire ARM was because of its dominance in the mobile computing market that includes laptops, tablets and smartphones. The British firm has 85 percent market share with a total of 1,348 signed licenses and it generated revenue of $1.489 billion, according to the company's 2015 annual report.
This current dominance of ARM on the mobile computing market could also suggest that the company's low-cost, low-power processors will be used as well in various electronic applications powering the Internet of Things market. SoftBank has consolidated its brand around internet and mobile services for consumers. The company could use the Internet of Things as a suitable platform to extend its services there as well.
According to The Verge, SoftBank's purchase of ARM is just the latest in a line of acquisitions in recent years, including a $15 billion investment in Vodafone's Japanese division and the $20 billion Sprint acquisition. In order to fund the acquisition of ARM Holdings, SoftBank sold a portion of its Supercell and Alibaba stake and made a massive loan of $9 billion.
