Additionally, SoftBank may receive up to $5 billion in cash or common stock under an earn-out construct, subject to satisfaction of specific financial performance targets by Arm.
All that is irrelevant, however, if SoftBank isn't allowed to flog the thing at all.
However, while a handful of options exist such as other open-source technologies RISC-V and MIPS, most can not now compete with Arm's mature ecosystem, tech experts said. The company will also build an AI supercomputer in Cambridge using Arm CPUs. This means the UK-based chip giant's vast computing ecosystem will merge with NVIDIA's leadership in artificial intelligence (AI) to drive innovation for all customers and create "a premier computing company for the age of AI". Already the dominant force in graphics chips that make video games more realistic, Nvidia has carved out a slice of the market for data center chips and is moving into self-driving vehicles. Arm has become successful by licensing its technology to more than 500 companies, many of which are rivals to Nvidia, and the sale would create a "monopoly problem", he said.
Arm will be a division under Nvidia, with its headquarters remaining in Cambridge. Almost every other company that would've been interested in buying Arm would've raised huge regulatory red flags.
"Since acquiring Arm, we have honored our commitments and invested heavily in people, technology and R&D, thereby expanding the business into new areas with high growth potential".
"We will expand on this great site and build a world-class AI research facility, supporting developments in healthcare, life sciences, robotics, self-driving cars and other fields".
The sale is a shock for the Cambridge, which is proud of its ability to develop world-leading technology and pharma: the sale follows a desperate bid to stop the ownership shift which included one of Arm's founding fathers, Hermann Hauser, who spun the chip maker out of Acorn in 1990.
Nvidia's acquisition of ARM from SoftBank also requires the approval of regulatory agencies in many countries. Arm's intellectual property will remain registered in the UK. Expect to see opportunist political types publicly drop generic protectionist soundbites, which the companies concerned clearly anticipate. The transaction does not include Arm's IoT Services Group. They either use Arm's designs as the basis of their own chips or license its instruction set, the fundamental code used by processors to communicate with software, for proprietary efforts.The acquisition by Nvidia, also a licensee, is a challenge to that neutrality. In this case Intel has historically placated regulators by licensing the tech to AMD, thus generating competition in the CPU space, so maybe there's a compromise in that direction. Completion of the transaction is expected to take place in approximately 18 months. As for concerns the deal will upset Arm's relationships with customers including Apple Inc., Huang said Nvidia is spending a lot of money for the acquisition and has no incentive to do anything that would cause clients to walk away. At today's prices it will be a 7% owner of new-look Nvidia, which seems like a pretty solid long term investment.