The ‘FT’ says that the Japanese investor will pay £17 for every ARM Holdings share: ARM share closed at £11.89 on Friday 15 th July, indicating a significant premium of the bid to current market valuation.
ARM – founded in 1990 as Advanced RISC Machines – claims over 60billion chips shipped to date that include its IP. The Japanese company’s move is seen as a bet on the future of the IoT, Internet of Things, and ARM IP – through licensing to the majority of the world’s makers of microcontrollers – will be present in vast numbers of connected devices and products, if the IoT concept takes off as expected. ARM technology, the company says, is in use in 95% of smart phones, 80% of digital cameras, and 35% of all electronic devices.
Market comment had predicted buy-ups of UK assets following the effective devaluation of the UK Pound (£) after the country’s decision to leave the European Union in the referendum of 23rd June 2016. In the recent past the £/Yen ratio peaked at over 190 Yen/£ in late 2015: prior to the UK’s referendum the exchange rate was around 160 ¥/£ and is currently around 140:1, effectively cutting the cost of the purchase for SoftBank.
SoftBank also holds a majority interest in US cellular provider Sprint, acquired in a 2013 deal.