It's been two months now that a rumour has been circulating about a possible takeover of the ARM company by NVidia. On Monday, September 14, the group announced that it has reached an agreement with Softbank in this regard and for an amount of 40 billion dollars, including 21.5 billion in NVidia shares and 12 billion in cash. Depending on ARM's financial performance, an additional payment of USD 5 billion is also envisaged. Softbank thus becomes a shareholder of NVidia with 10% of the shares.
It is in the context of the implementation of its strategy in AI, a market it is already targeting with its graphics chips adapted to the types of calculations required for model training or inference that NVidia is setting up this operation. GPUs are indeed more suited to this task than CPUs and have therefore been quickly adopted which has opened up many markets including data centers with growing finances.
Thanks to this acquisition, NVidia thus becomes the world leader in the GPU market but also the leader in the design of mobile chips. ARM designs are indeed used in all processors on the market and are also present in smartphones, tablets, connected objects and specialized low-power equipment as well as in data centers. In fact, Apple is planning to use them as a replacement for its Intel processes.
The CEO of NVidia commented: "Artificial intelligence is the most powerful technological force of our era and has launched a new wave of computing. In the years to come, thousands of billions of computers using AI will create a new Internet of Things that will be thousands of times larger than today's Internet of Things. This acquisition will create a company fabulously well positioned for the AI era."
It should also be remembered that ARM is a British company and that Softbank undertook, when it was acquired, to maintain its position in the United Kingdom. NVidia thus reiterated this promise, explaining that the company's headquarters would remain in Cambridge and that it would be expanded with the aim of creating a world-class artificial intelligence research centre. The group will also build a state-of-the-art supercomputer using its GPUs and ARM CPUs to bring in scientists and engineers as well as a start-up accelerator.
NVidia has also promised to maintain ARM's open licensing model and neutrality. This condition is thus essential to guarantee the authorisation of this takeover. Of course, this takeover does not signal the end of the ARM brand either, and NVidia makes clear that ARM customers will also benefit from certain innovations.