Nvidia has formalized the agreement with SoftBank for the purchase of ARM, a chip company, for a total amount of 40 billion dollars, around 33 billion euros, between cash and shares.
After some rumors and clues around a possible acquisition of ARM by Nvidia, the American company came out of the closet formalizing the billionaire operation. SoftBank, the Japanese company now former owner of ARM, in return, it will get $ 21 billion in Nvidia stock, $ 12 billion in cash, $ 5 billion linked to ARC's financial performance, and $ 1,5 billion in equity.
The operation will lead SoftBank to hold between 6,7% and 8,1% of Nvidia shares. The transaction has yet to be approved by several competition agencies, including the European, the UK and the US.
ARM will become a division of Nvidia, which has promised it will not change the way the newly acquired company works. Despite the reassurances, however, some concern filters through the circles of major ARM customers. A political background is added to the uncertainty regarding the operation: the passage of ARM to a US company could upset China, which has long been at odds with the US government on technological issues.
Nvidia also announced that it will retain ARC's UK headquarters. It will also develop a research center of excellence in collaboration with the University of Cambridge.
But even in the midst of these concerns the CEO of Nvidia Jensen Huang said he was optimistic:
"AI is the most powerful technology of our time and ushered in a new era for computers. Over the next few years, billions of AI-powered computers will create a new internet of things, immensely larger than today's internet of people. The combination of these two companies will create an entity ready for this new era of AI "
This acquisition will change the world of technology, creating a new behemoth and new power dynamics. Provided competition agencies approve.