SoftBank, a multinational telecommunications and Internet firm, is offering £17 per share for ARM Holdings. That’s a 43% premium on ARM Holdings’ closing market value of £16.8 billion on Friday.
ARM’s board of directors is expected to soon recommend that shareholders take the offer.
After the announcement, the response to the deal has been quite staggering. After the open of the London Stock Exchange, ARM’s shares surged by a whopping 45%.
Not a whole lot should change as part of this deal. ARM still plans to keep its headquarters in Cambridge and has a lot of plans for expansion. SoftBank says that it expects to nearly double ARM’s UK staff within the next five years. The company will be doing this all while making a big expansion overseas.
SoftBank is one of the world’s largest technology companies, according to Forbes’ Global 2000 list. Not only that, but it’s the third largest company in Japan.
With that in mind, it’s without a doubt that ARM found a good parent company. SoftBank is ran by its founder, Masayoshi Son. Son made the following announcement Monday morning:
“This is one of the most important acquisitions we have ever made, and I expect ARM to be a key pillar of SoftBank’s growth strategy going forward.”
On the other hand, the response from ARM Holdings’ co-founder Hermann Hauser wasn’t very optimistic. Hauser told the BBC the following:
“This is a sad day for me and a sad day for technology in Britain. ARM is the last British [technology] company that has a global reach. It gave Britain real strength. It was a British company that determined the next generation microprocessor architecture.”
SoftBank noted that this was by no means a response to the recent weakness of the British pound. This was a deal that has been in the works for a few years now.
Now, what will come of this deal? This is something we’ll have to wait and see. As Son announced, he expects ARM to be a “key pillar” of SoftBank’s future growth.
The road ahead for ARM Holdings will certainly be an interesting one.