Editor? /? Text? wisecrack
Design? /? Du? triumphant
Source? /? Wall Street Journal? Author Carla? Rembado, Maureen? Farrell
One of the important goals of the chip industry in the future is to support more and more daily items to access the Internet, which is commonly known as the "Internet of Things", and self-driving cars are an important part of it. Although affected by the epidemic, the progress of various industries in the world has slowed down or even run aground, chip manufacturers are constantly seeking scale and expanding product portfolio, and the pace of semiconductor industry integration is accelerating.
/kloc-in September, 2003, NVIDIA, the largest chip manufacturer in the United States, announced that it would buy $40 billion from Softbank? Group) acquired its British chip design subsidiary Arm. The two companies said that the deal will reshape the global semiconductor landscape.
40 billion dollars, the largest acquisition in the semiconductor field came out.
Although $40 billion is already a sky-high deal. However, compared with the offer of $52 billion when Softbank expressed its intention to sell in April to find a buyer, the price has been reduced by $654.38+02 billion. Even so, compared with the price of $32 billion when Softbank and its subsidiary Vision Fund acquired Arm in 20 16, CEO Sun Zhengyi made a net profit of $8 billion in four years.
The transaction method will be cash+stock. NVIDIA needs to pay $21500 million in stock and $654,380+0.2 billion in cash to Softbank, including $2 billion at the time of signing the contract. After the transaction is completed, Softbank and the holding arm? The Vision Fund, which owns 25% of the shares, will hold 6.7% to 8. 1% of the shares in NVIDIA.
In a statement on September 13, the two companies said that if Arm's performance reaches certain targets, Softbank may get an additional $5 billion in cash or stock. NVIDIA said that he plans to issue1500 million USD equity to Arm employees.
The sale of Arm to NVIDIA may lead to the scrutiny of antitrust regulators and may be blocked by Arm customers, including major chip manufacturers and electronics manufacturers, such as Intel Corporation, Samsung Electronics Corporation and Apple Corporation.
Softbank and Arm said that regulatory approval may take as long as 18 months, so it is expected that the transaction will be completed within 18 months, that is, in March 2022.
If the transaction is concluded, it will be one of the biggest transactions so far this year, and it may also be the largest semiconductor transaction in history.
Another big deal this year is chip maker Analog? Devices bought Maxim for $22 billion? Comprehensive? Products.
Analysts said that NVIDIA faced major regulatory obstacles in the process of acquiring Arm, because Arm licensed its technology to several major competitors in NVIDIA. In an interview in July, Bernstein analyst Stacy? Rasgon said. "I think the response from regulators and consumers will be enormous."
Softbank and NVIDIA win-win.
"We will join hands with Arm to build a leading computer information processing technology company in the era of artificial intelligence," NVIDIA CEO Huang Renxun said in a letter to employees on September 13.
Arm does not produce chips, but it creates instruction set architecture, which supports the most basic IP of computing chips, which is the basis of computing core design.
Arm's chip design is now also used to run data centers, which is a fast-growing and lucrative market for chip manufacturers. The microprocessor designed by Arm drives most smart phones in the world. By joining hands with NVIDIA, the merged company will become a strong participant in the chip industry.
It turns out that NVIDIA's high-end graphics processors for games and blockbusters are more suitable for these data-intensive systems than those provided by competitors led by Intel. At present, NVIDIA is the leading force in the field of graphics chips that make game pictures more realistic, and has gained a share in the data center chip market.
Its market value and influence have risen rapidly among technology companies, and its share price has risen by more than 100% this year, making it the best performing stock in the Standard & Poor's 500 Index.
At the same time, NVIDIA is marching into the field of self-driving cars. These technologies require semiconductors with more computing power to process massive data.
"Surprisingly, artificial intelligence software can perceive the environment, infer the best solution, and take intelligent actions. This new form of software will extend computing to every corner of the world. " Huang Renxun said in a letter to employees. "One day, trillions of computers running AI will create a new Internet-the Internet of Things."
Sun Zhengyi, chairman and CEO of Softbank, called NVIDIA the perfect partner of Arm.
"Since the acquisition of Arm, we have fulfilled our promise and invested heavily in personnel, technology and R&D, thus expanding our business into new areas with high growth potential," he said in a statement. "Working together with the world's leading technology innovation companies has created new and exciting opportunities for Arm."
Affected by the acquisition news, Softbank's share price rose 10% in Tokyo.
Softbank has been under pressure to support its depressed share price, and the company is reducing its stake in its main assets to raise cash. The assets sold include most of the shares held by China Alibaba Group and German telecom company T-Mobile USA.
Softbank also bought options related to $50 billion in technology stocks this year. The Wall Street Journal reported that the size of the bet had a huge impact on the entire stock market, which pushed the stock price up.
The Wall Street Journal reported in July that Softbank is exploring various outlets for Arm, including all or part of the sale or IPO. Arm has indicated that it plans to transfer two IoT service departments to new entities, which will be owned and operated by Softbank to better focus on its core semiconductor IP business. It later changed the move and said it would keep these businesses in-house.
NVIDIA announced that it will keep the headquarters of Arm in the UK, and invest in establishing a new AI research institution there to promote AI research and provide experimental sites for robotics and automation. Huang Renxun said that this commitment shows that the acquisition is to increase its technology footprint in the UK, not to weaken it.
The importance of Arm is far from being measured by its revenue, which comes from the fundamentals of authorized chips and the design of sales processors. But its technology is the core of more than10 billion smartphones sold every year. From factory equipment to household electronic products, there are chips using their codes and layouts.
NVIDIA's motivation for acquiring Arm is to bring artificial intelligence into all "devices with switches". After successfully selling NVIDIA's graphics chips to data center owners to speed up image recognition and language processing, Huang Renxun's next step is to ensure that his technology covers all "switching devices", from self-driving cars to smart meters.
"The influence of Arm is different from that of any company in the history of science and technology," Huang Renxun said in an interview. "We combine NVIDIA's leading artificial intelligence computing with Arm's huge ecosystem."
China holds the key vote.
The deal puts Apple and other chip suppliers in the whole industry under the control of a single player, which is bound to face potential pressure from regulators and competitors in NVIDIA.
The acquisition needs to be approved by the regulatory authorities including Britain, the United States and China, but in China, thousands of companies, from Huawei to small start-ups, are using Arm technology, so the acquisition may be closely watched. Remember, Qualcomm's attempt to buy NXP was rejected by China.
"Now Arm will become an American company, and since China still controls Arm China, the conflict between China and the United States in the semiconductor field is becoming fierce," said Kachitas, an M&A consulting firm. Hiroji Hirai, head of the Tokyo company, said.
After the transaction was announced, Huang Renxun said that his team was looking forward to dealing with China regulators and was confident that the acquisition would be approved. In the booming data center business, NVIDIA is stepping up the acquisition of some technologies that have not yet been involved. In April, it completed the acquisition of Israel Mellanox Company, which produces high-speed network technology for data centers and supercomputers.
Broke Arm's customer neutrality
Through independent operation, Arm has opened up a successful niche market for itself. Fierce competitors such as Apple, Samsung, Qualcomm, Broadcom, Intel and Huawei are all licensees. They either use the design of Arm as the basis of their own chips, or authorize their instruction set (the basic code for communication between processors and software) for proprietary research and development.
The acquisition of NVIDIA, which is also the licensee, is a challenge to this neutrality and is bound to cause an uproar. Some people may ask, why is the acquisition of Softbank basically uncontroversial four years ago? Because there is no competition between Softbank and Arm customers, but there is in NVIDIA. This is equivalent to the top players in the game getting the best equipment, which is undoubtedly more powerful.
Huang Renxun talked about the concern that the deal would damage the customer relationship between Arm and companies such as Apple. He said that Arm will continue to operate its open licensing model while maintaining global customer neutrality, which is the basis of its success and hopes to expand its customer list.
He thinks that NVIDIA has spent a lot of money on this acquisition, and there is no reason or motivation to do anything that will lead to the loss of customers. In addition, NVIDIA will add its own technology to the products authorized by Arm.
Arm's chip design and technology have been authorized to customers such as Qualcomm, Apple and Samsung Electronics. Apple's upcoming Mac computer chip is based on Arm design architecture. Will the acquisition of Arm make NVIDIA and Intel and Advanced? Micro? Competitors such as devices are more competitive in the data center chip market because Arm has been developing competitive technologies.
Huang Renxun said that this is equivalent to directly challenging these competitors, and it is possible for NVIDIA to build its own server chip based on Arm design. According to this transaction, Arm will not be subject to US export control.
Direct attack on Intel?
After the successful acquisition, the biggest direct challenge is Intel. Huang Renxun said that he would give priority to the work of computing chips in the data center designed by Arm. Although he opened up a $3 billion niche market in the business of providing graphics processors for Google's Alphabet and Facebook to help them complete the artificial intelligence workload.
But Huang Renxun said that he hoped to accelerate the adoption of the central processing unit (CPU) based on Arm. Because this is a lucrative market, it has always been dominated by Intel, accounting for about 90% of the market. This marks the first time in the history of this field that a company will truly replace Intel's position as an industry leader.
Invista will also get a big piece of cake in the mobile industry and smart phones. Previously, Invista tried to break Qualcomm's dominant position in this business, but failed. In terms of smart phone processors, Qualcomm's biggest competitor is Apple's internal strength. These two companies are one of Arm's biggest customers.
This article comes from car home, the author of the car manufacturer, and does not represent car home's position.