It’s official – Nvidia will acquire ARM from Softbank for $40 billion

As with all deals of this size, Nvidia’s acquisition of ARM requires regulatory approval. At this time, it is unknown when this deal is expected to close, or how Nvidia plans to utilise ARM moving forward. 

Nvidia has already committed to continuing ARM’s open-licensing model and maintaining global customer neutrality. Beyond that, Nvidia has agreed to continue maintaining ARM’s brand identity and to expand its base in Cambridge. ARM’s IP will also continue to be registered in the UK, and Nvidia plans to build up ARM’s R&D resources within the region. These stipulations should help Nvidia attain approval for the transaction within the UK. 

ARM is currently the world’s premier low power CPU provider, powering practically all modern smartphones and tablet devices. The ARM CPU architecture has also seen growing use within the server market and within high-performance computing applications, with Apple committing to using ARM processors with their planned “Apple Silicon” devices.     

At this time, it is unknown what Nvidia’s plans for ARM are. Nvidia wouldn’t pay $40 billion if they didn’t have plans to exclusively benefit from some aspects of ARM. Nvidia has confirmed its plans to create a state-of-the-art, Arm-powered AI supercomputer, highlighting how Nvidia plans to utilise ARM in conjunction with their existing AI and networking products and IP. 

As part of this deal, Nvidia will pay Softbank a total of $21.5 billion in NVIDIA common stock and $12 billion in cash. In addition to this, Nvidia will pat Softbank an additional $5 billion in cash or common stock should ARM meet its financial performance targets. A further $1.5 billion in equity will be issued to ARM employees. 

Update – Nvidia expects the acquisition to be completed within 18 months, assuming the acquisition attains regulatory approval.