Linked by Thom Holwerda on Mon 18th Jul 2016 05:04 UTC
Hardware, Embedded Systems

SoftBank is nearing a deal to acquire ARM Holdings, the British semiconductor company, said two people briefed on the matter who asked not to be named discussing private information.

The deal would be the first large-scale, cross-border transaction in Britain since it voted to exit the European Union last month. ARM had been seen as a safe haven from the volatility surrounding “Brexit” because its chip technology is used in mobile phones all over the world, with limited revenue derived from Britain.

Remarkable news on such an early Monday morning. One of the larger purchases in the technology world, and of a core and extremely crucial company at that. I'm wondering if the major technology companies are okay with this deal, since many of them rely heavily on ARM's technology.

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shotsman
Member since:
2005-07-22

"Ok. How much is this gonna cost me?"

i.e. When and by How much will the cost of ARM licenses go up?
IMHO, a price rise is inevitable. Why else would they pay such a premium on the share price? Softbank need to recoup that investment (and more) before they (possibly) decimate the business and walk away leaving just a smoking ruin.
I don't see any upside to this deal in the long term UNLESS, they are buying it as a proxy for some other unnamed entity. This deal is not in the established business area for Softbank. Why would the risk so much by venturing into this new area?

£24B is a lot of dosh to stump up. Who in the Tech Biz has this sort of cash kept outside the USA just for this sort of thing?

Edited 2016-07-18 05:43 UTC

Reply Score: 2

piotr.dobrogost Member since:
2011-10-04

Why do you think cash is kept outside of the USA?

Reply Score: 1

DeepThought Member since:
2010-07-17

Because all those US global players are parking their money outside the US because of the taxes.
It is even "cheaper" for them to make debts in the US then getting the money back.

[Edit: Is this true for a Japan based company, maybe.]

Edited 2016-07-18 08:09 UTC

Reply Score: 3

Athlander Member since:
2008-03-10

This deal is not in the established business area for Softbank. Why would the risk so much by venturing into this new area?


They could be looking to diversify their portfolio - seeing as this mobile network company, a book publishing company, a broadband supplier and a basketball team, a chip designer isn't so far-fatched. They could be under pressure to do something with their cash reserves.

It remains to be seen how autonomous ARM will be. Japanese management culture doesn't seem to cope well with the pace of the technology industry these days.

Reply Score: 3

Adurbe Member since:
2005-07-06

Japanese management culture doesn't seem to cope well with the pace of the technology industry these days.


what an odd generalization. There are plenty of Japanese companies who are doing very well indeed. Even without looking at Pokemon go and its massive success

Reply Score: 2

Athlander Member since:
2008-03-10

There are plenty of Japanese companies who are doing very well indeed. Even without looking at Pokemon go and its massive success


Pokemon Go was created by Niantic, an American company. At least the idea came from the Pokemon Company, although it was inspired by a previous augmented reality game by... Niantic.

Reply Score: 3

ahferroin7 Member since:
2015-10-30

Add to that that the coding itself is rather shoddy (I know dozens of people who play it who have regular issues with it hanging, crashing, or just generally misbehaving) and it's not all that inventive of a game (it's just geocaching with Pokemon, with a level system tacked on to make it feel competitive). If anything, it would almost reinforce the point that it was brought up to counter, if it were developed by a Japanese company.

Reply Score: 1

Adurbe Member since:
2005-07-06

so Americans are bad at coding? (that generalization ok too?)

Reply Score: 1

ahferroin7 Member since:
2015-10-30

I'd say a more accurate statement is that many people who work for video game companies aren't good at coding, not just Americans. I find more bugs and other programming issues in video games than any other type of software, although I think that's partly because the whole industry has been moving towards 'end user is also beta tester' mentality, which would be a suicide move in almost any other industry (Evolve immediately, the developers there essentially got people to pay a significant amount of money to be beta testers).

Reply Score: 1

kwan_e Member since:
2007-02-18

I find more bugs and other programming issues in video games than any other type of software, although I think that's partly because the whole industry has been moving towards 'end user is also beta tester' mentality


I think it's being overworked, more than any mentality.

Reply Score: 4

shinkou Member since:
2011-03-24

Isn't it because people spend more time on games than anything else so they find more bugs, and earlier?

/my2cents

Reply Score: 1

dpJudas Member since:
2009-12-10

I'd say a more accurate statement is that many people who work for video game companies aren't good at coding

This is because video games fall into the "code once and throw away" category of coding. That is, the game logic part of a game can be written by rookies with extremely limited experience because it doesn't have to be reused. As a result students and junior devs write the bulk of it - if not artists themselves in some cases.

Contrast this with the game engines that are written by completely different types of developers. What tend to go wrong is when management thinks that you can use the students to do the server infrastructure coding and such stuff. A classical management mistake where they think all devs are alike.

Reply Score: 2

Adurbe Member since:
2005-07-06

I was under the impression that the project was managed by the Pokemon company, which in turn, has Japanese management. Either way, I still consider it an overgeneralization to say that because SoftBank are Japanese they cant keep up with technology.

Reply Score: 2

tylerdurden Member since:
2009-03-17

Japanese management culture doesn't seem to cope well with the pace of the technology industry these days.


Wow, just wow.

Reply Score: 1

dionicio Member since:
2006-07-12

rewow!

Reply Score: 2

dionicio Member since:
2006-07-12

At this level money no issue: Money will 'geyser' from surprising places. [Geo]Politics [most probably 'Brexit' triggered] use to be 'The Reason' Up Here.

Reply Score: 2

gan17 Member since:
2008-06-03

This deal is not in the established business area for Softbank. Why would they risk so much by venturing into this new area?

They're trying to reserve their own coach in the "Internet of Things" train(wreck?), me thinks.

Reply Score: 3

dionicio Member since:
2006-07-12

This is a "proxy" World Economy ;)

Reply Score: 2

quackalist Member since:
2007-08-27

Tears at bedtime for someone, methinks. Not that it'll be the bankers who lent the monies to a company more likely to go bankrupt then survive.

Just too much funny money sloshing around with only low or negative interest rates for returns. Some sort of a bankers version of musical chairs with music just about to end and no chairs left.

Reply Score: 2

allanregistos Member since:
2011-02-10

"Ok. How much is this gonna cost me?"

i.e. When and by How much will the cost of ARM licenses go up?
IMHO, a price rise is inevitable. Why else would they pay such a premium on the share price? Softbank need to recoup that investment (and more) before they (possibly) decimate the business and walk away leaving just a smoking ruin.


Unless if you really know the strategy, vision or product roadmaps or whatever of Softbank, the comment from you is just a smoking ruin.

Softbank is also a manufacturer of Smartphones, so acquiring a chip designer must be a good investment for them. Softbank's smartphone is cool, one of their smartphones I saw is 3D capable without using a glass.

Edited 2016-07-20 00:34 UTC

Reply Score: 2

Bank loan
by Athlander on Mon 18th Jul 2016 10:13 UTC
Athlander
Member since:
2008-03-10

Worrying that they need a long-term loan from Mizuho Bank to fund this acquisition.

Reply Score: 2

Sad news.
by dsmogor on Mon 18th Jul 2016 11:19 UTC
dsmogor
Member since:
2005-09-01

After Brexit I started wondering what's part of the solid foundation of UK (or european in general) based tech industry (as a counterweight for the financial companies) and Arm came out as one of the bright spots.
And now this...

Reply Score: 5

RE: Sad news.
by Adurbe on Mon 18th Jul 2016 13:07 UTC in reply to "Sad news."
Adurbe Member since:
2005-07-06

They will still pay UK tax for the time being. But don't expect it will be long before the HQ moves to the mainland or even to Asia where the chips are actually fabricated.

Reply Score: 2

Ouch!
by dionicio on Mon 18th Jul 2016 15:33 UTC
dionicio
Member since:
2006-07-12

ARM Holdings being such a IT Titan this intention has the strongest political and strategical variables. UK would do well if clearing the forward panorama.

Reply Score: 2

RE: Ouch!
by dionicio on Mon 18th Jul 2016 15:36 UTC in reply to "Ouch!"
dionicio Member since:
2006-07-12

[Should I say England?]

Reply Score: 4

RE: Ouch!
by dionicio on Mon 18th Jul 2016 15:41 UTC in reply to "Ouch!"
dionicio Member since:
2006-07-12

Doesn't England realize that Brexit realizing trashes geopolitical status?

Reply Score: 2

Comment by zzarko
by zzarko on Mon 18th Jul 2016 17:27 UTC
zzarko
Member since:
2011-01-09

So bye, bye, Miss Raspberry Pi...

Reply Score: 0