Japan’s SoftBank to buy out UK tech firm ARM Holdings for £24bn
The most successful technology company in Britain, ARM Holdings, has agreed to a £24.3bn takeover by Japanese firm SoftBank, one of the biggest tech companies in the world.
While many people might not actually know who ARM is, you are highly likely to have used their products. The company designs microchips, which are used in more than 95 per cent of all smartphones, including the Apple iPhone range and Samsung phones.
Based in Cambridge and founded in 1990, there are more than 3,000 people employed by the firm. The company has said that its headquarters will stay in Cambridge, and the number of people employed would more than double in the next five years.
Despite 15 billion microchips being produced last year using ARM’s design, less than 50 per cent went into smartphones. Everyday items which need processing power, such as televisions and washing machines, were where the remaining microchips ended up being used.
Shares will be bought at a cost of £17 each by SoftBank, 43 per cent higher than Friday’s closing market value of £16.8bn.
“This is a compelling offer for ARM shareholders, which secures the delivery of future value today and in cash,” said Stuart Chambers, chairman of ARM.
“The board of ARM is reassured that ARM will remain a very significant UK business and will continue to play a key role in the development of new technology.”
ARM’s board will recommend the sale to shareholders, and the all-cash deal will lead to many board members receiving many millions of pounds. The stake of Mike Muller, COO, is valued at £21m, while chief executive Simon Segars’ stake is valued at £11m.
Commenting on the deal, SoftBank founder and chief executive Masayoshi Son said: “This is one of the most important acquisitions we have ever made, and I expect ARM to be a key pillar of SoftBank’s growth strategy going forward.
“We have long admired ARM as a world-renowned and highly respected technology company, that is by some distance the market leader in its field.
“ARM will be an excellent strategic fit with the SoftBank group as we invest to capture the very significant opportunities provided by the internet of things.”