According to the financial news agency, Bloomberg, Nvidia is in advanced talks to buy chip designer, Arm. Something that could be a fundamental shift in the industry.
In the article, Bloomberg explained that various sources have revealed that Nvidia is gearing up to acquire Arm for an unknown sum. Arm was bought by SoftBank Group Corp. for $32 billion four years ago and has gone from strength to strength since then. In recent times, it's been announced that Apple is switching to Arm-based processors in its hardware lineup as of next year which is certainly helping the value of the chip designer.
It might seem like a big ask of Nvidia's coffers but as it's already a customer of Arm, it would make a lot of sense. The largest maker of graphics processors right now, the firm is spreading into new areas such as data centres, artificial intelligence, and self-driving cars, suggesting Nvidia has ambitious plans that Arm could certainly help with. It's not like Nvidia is struggling either with the company consistently posting record financial results and no sign of slowing down.
As mentioned, no set amount has been offered here but analysts seem to think the acquisition may cost Nvidia around $55 billion. Right now, it's also the only potential buyer although more may emerge.
There are some issues in the way though. Notably, it's expected to trigger regulatory scrutiny according to Bloomberg given that Arm has so many other clients including Qualcomm and Apple. If it does happen, those clients will need assurances that they still get equal access to Arm's capabilities.
If it does happen, it could end up the largest deal ever in the semiconductor industry. Bear in mind though, it's a big if right now. Advanced talks still collapse and there are the aforementioned legal steps to take into consideration along the way. If it goes ahead though? It could mean a huge shift in the chip market and massively help Nvidia's chances of further development and growth. We suspect the key here is that assurances are made for existing clients so that there are no issues with regulations along the way.
Like we said, for now, this is an uncertain field with a lot of obstacles in the way. Still, imagine a future where Nvidia could potentially take on Intel and AMD. It might just happen. At least in terms of data centres if not consumer devices.
November 6 2020 | 17:30