Back in September 2020, NVIDIA embarked on a deal to acquire ARM for around $40 billion. Recently, however, we got word from inside the company that the deal was not going through. Now, thanks to The Verge, we have more information about what’s going on, and it seems that NVIDIA owes SoftBank some money.
The deal most likely won’t happen
The Verge reached out to NVIDIA to comment on whether the deal had fallen through or not, but the company did not respond. As a matter of fact, neither ARM nor SoftBank commented on the status of this deal. However, three sources with knowledge of the unfolding events say that NVIDIA will not be buying the company. This lines up with the recent report from Bloomberg that stated that the deal had fallen through.
NVIDIA actually owes SoftBank money
The three sources did give us another bit of information. It seems that NVIDIA will, indeed, give SoftBank money, but not how it planned. The sources said that NVIDIA owes money for the deal not going through. It will be paying SoftBank a sum of $1.25 billion which is a far cry from $40billion. It seems like it’s compensation for wasting the company’s time. While that’s a hefty sum to most people, it’s chump change for NVIDIA.
What would happen if the deal succeeded?
If you recall, NVIDIA is really big in the graphics card industry among other industries. A year and a half ago, it started negotiations to buy ARM from SoftBank. ARM is the company that makes the CPU architecture for companies such as Qualcomm, Google, Apple, Samsung, Huawei, MediaTek, and many more. Almost every smartphone and tablet are running a chip made with ARM’s CPUs.
If NVIDIA were to get control of ARM, it would be a really powerful entity in the chip industry (a bit too powerful, to be honest). The company would have sway over the entire smartphone industry as well as the budding ARM-based computer industry. Not only that, but ARM makes chips for countless other mobile devices.
It’s for the best that NVIDIA doesn’t own ARM. We can’t have one chip company with that much control over the chip market. It’s similar to when Apple tried to buy ARM before SoftBank bought it.
2022-02-08 15:06:06