Japanese telecom giant SoftBank has confirmed that it planned to acquire U.K.-based semiconductor chipmaker ARM Holdings (ARM) in a £24.3 billion ($32 billion) cash deal.
This deal represents Softbank’s biggest acquisition since the $21.3 billion buyout of U.S. telecoms company Sprint, and the biggest-ever acquisition of a European tech company.
Founded out of Cambridge, U.K., in 1990, ARM powers the processors in most of the world’s smartphones, including iPhones, and with its low power-consumption and cost the company is also pushing hard into the burgeoning Internet of Things (IoT) industry.
ARM, originally called Advanced RISC Machines, before switching to its acronym in 1998, was a joint venture between Apple, VLSI Technology, and Acorn Computers, and was chosen by Apple for use in its Newton PDA device, which was a flop.
In the wake of Softbank’s acquisition, the Tokyo-based company said that it will maintain ARM’s Cambridge HQ, double its employee headcount in the U.K. over the next five years to six thousand, and retain its current partnership-based business model and senior management structure.
Masayoshi Son, chairman and CEO of SoftBank, said in a statement:
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 within the SoftBank group as we invest to capture the very significant opportunities provided by the “Internet of Things”.
This investment also marks our strong commitment to the U.K. and the competitive advantage provided by the deep pool of science and technology talent in Cambridge. As an integral part of the transaction, we intend to at least double the number of employees employed by ARM in the UK over the next five years.
SoftBank intends to invest in ARM, support its management team, accelerate its strategy and allow it to fully realise its potential beyond what is possible as a publicly listed company. It is also intended that ARM will remain an independent business within SoftBank, and continue to be headquartered in Cambridge, U.K..
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.