The combination of the two companies will bring together NVIDIA’s AI computing platform with the Arm ecosystem to create a computing company that is primed for the AI age. It will allow NVIDIA to expand into large, high-growth markets. SoftBank will remain committed to Arm’s long-term success through its ownership stake in NVIDIA, expected to be under 10 percent.
Arm will continue with its current open-licensing model and keep the global customer neutrality that has been the foundation to its success. Arm partners will also be able to benefit from both companies’ offerings. NVIDIA has also committed to retaining the name and strong brand identity of Arm and to expand Arm’s base in Cambridge. Arm’s IP will still be registered in the U.K.
NVIDIA will establish a new global centre of excellence in AI research at Arm’s Cambridge campus. At the new facility, the company will invest in an Arm-powered AI supercomputer, developer training facilities and a startup incubator. The incubator is intended to attract research talent and create a platform for innovation and industry partnerships.
“Simon Segars and his team at Arm have built an extraordinary company that is contributing to nearly every technology market in the world. Uniting NVIDIA’s AI computing capabilities with the vast ecosystem of Arm’s CPU, we can advance computing from the cloud, smartphones, PCs, self-driving cars and robotics, to edge IoT, and expand AI computing to every corner of the globe”, said Jensen Huang, founder and CEO of NVIDIA. He continued “Arm will remain headquartered in Cambridge. We will expand on the site and build a world-class AI research facility, supporting developments in healthcare, life sciences, robotics, self-driving cars and other fields. And, to attract researchers and scientists from the U.K. and around the world to conduct groundbreaking work, NVIDIA will build a state-of-the-art AI supercomputer, powered by Arm CPUs. Arm Cambridge will be a world-class technology center.”
NVIDIA will pay SoftBank a total of $21.5 billion in NVIDIA common stock and $12 billion in cash, which includes $2 billion payable at signing. The number of NVIDIA shares to be issued at closing is 44.3 million, determined using the average closing price of NVIDIA common stock for the last 30 trading days. 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.
The transaction does not include Arm’s IoT Services Group and is expected to be completed in around 18 months.