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SoftBank near deal for chip leader ARM

(China Daily) Updated: 2016-07-19 08:03

SoftBank near deal for chip leader ARM

An ARM and SoftBank Group branded board is displayed at a news conference in London, Britain July 18, 2016. [Photo/Agencies]

SoftBank Group Corp is nearing a deal to buy ARM Holdings Plc for more than $32 billion, people with knowledge of the matter said, securing a slice of virtually every mobile computing gadget on the planet and future connected devices.

The deal discussions started as a result of an approach from SoftBank, and ARM didn't run an auction process, two people said. The deal would be the biggest-ever for SoftBank, which under Chairman Masayoshi Son is one of Japan's most acquisitive companies with stakes in wireless carrier Sprint Corp and Alibaba Group Holding Ltd.

A deal would give SoftBank control of a cash-generating mobile chip leader, and a share of revenue in everything from smartphones to connected gadgets in the home. The British semiconductor designer gets royalties when companies from Apple Inc and Samsung Electronics Co to Qualcomm Inc adopt its designs, which are considered power-saving and efficient.

The Japanese company is also buying into a British currency that's weakened considerably against the yen since the country's decision to depart the European Union. Beyond its sheer scale, the ARM acquisition is unusual for a company that had preferred to take control through hefty stakes in its companies.

"As much as we hated the decision of buying Sprint, we believe if Son wanted to bet on the sterling recovering he picked a great name in the tech sector," said Amir Anvarzadeh, Singapore-based head of Japanese equity sales at BGC Partners Inc.

Bloomberg

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