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SoftBank is selling British chipmaker ARM to Nvidia for $40 billion

September 14, 2020. Summarized by summa-bot.

Jen-Hsun Huang, president and chief executive officer of Nvidia Corp., speaks during the company's event at the 2019 Consumer Electronics Show (CES) in Las Vegas, Nevada, U.S., on Sunday, Jan. 6, 2019. CES showcases more than 4,500 exhibiting companies, including manufacturers, developers and suppliers of consumer technology hardware, content, technology delivery systems and more. Photographer: David Paul Morris/Bloomberg via Getty Images

US giant Nvidia is buying British chipmaker ARM from SoftBank for as much as $40 billion.

Hong Kong (CNN Business)Nvidia is buying British chipmaker ARM from SoftBank for as much as $40 billion — a total that would make it the largest semiconductor deal ever.

Nvidia said Sunday that it plans to keep Arm's headquarters in Cambridge, as well as expand its campus with a new research facility.

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 — which purchase chip designs from ARM — are also likely to object.

Another asset sale for SoftBank

The deal comes four years after SoftBank bought ARM for $32 billion, marking the largest foreign takeover by a Japanese firm at the time.

SoftBank has been working to divest assets in recent months as the conglomerate looks to raise cash in response to the coronavirus pandemic.

The Financial Times also reported Monday that SoftBank is reconsidering a plan to privatize the company.

If the ARM deal goes through, it will be the semiconductor industry's biggest-ever deal, topping Avago's acquisition of Broadcom in 2015, according to Dealogic.

SoftBank will receive a stake of less than 10% in Nvidia, and the Japanese company will also be eligible for a payout of up to $5 billion if ARM meets "specific financial performance targets," according to SoftBank.

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