The agreement announced on Sunday will be financed through a mix of cash and stock, the companies said in a joint statement.
Nvidia said on Sunday that it plans to keep Arm’s headquarters in Cambridge, as well as expanding its campus with a new research facility.
“ARM’s business model is fantastic. We will maintain our open-licensing model and customer neutrality, serve customers in any industry worldwide and further expand ARM. [intellectual property] Licensing Portfolio, ”Huang wrote.
The deal is likely to come under significant scrutiny in the United Kingdom, where some politicians are concerned about preserving jobs at ARM. Nvidia’s rivals – who buy chip designs from ARM – are also likely to object.
The Prime Minister’s official spokesman said on Monday that the UK government would not hesitate to investigate any acquisitions that could have a major impact on the country.
Sale of another property for SoftBank
“The combination is likely to raise SoftBank’s stock price in Tokyo,” wrote Jeffrey Haley, Asia Pacific’s senior market analyst at Oda.
Under the agreement, Nvidia will pay approximately $ 12 billion in cash and $ 21.5 billion in stock. According to SoftBank, SoftBank will get a stake of less than 10% in Nvidia, and the Japanese company will also be eligible for payments of up to $ 5 billion when ARM meets “specific financial performance goals”. The company did not disclose the goals.
The deal is expected to close within 18 months. It must first pass regulatory approval from the United Kingdom, the European Union, the United States and China.
– Luke McGee and Charles Riley contributed to this report.