SoftBank considering sale or IPO of chip design company Arm Holdings

AppleInsider · July 13, 2020 9:34PM

Amid the early stages of Apple's transition to ARM-based silicon, SoftBank is reportedly mulling a sale or public offering of Arm Holdings.

Credit: Arm Holdings

Arm Holdings is the company that designs and licenses the base ARM architecture used in Apple chips like the A12Z Bionic. It is also wholly owned by Japanese conglomerate SoftBank, but that may not be the case forever.

According to a new report in The Wall Street Journal, SoftBank is looking at alternatives like a full or partial sale or an initial public offering (IPO) of the chip design company.

The Japanese company, with Goldman Sachs acting as an advisor, is still in the early stages of the exploration. It isn't clear how the plans will pan out, and it's possible that SoftBank will choose to do nothing.

Apple licenses chip architecture technology from Arm Holdings for its proprietary A-series chips, which power iPhones and iPads. Since WWDC 2020, it's also clear that Apple plans to transition its Mac lineup to first-party, ARM-based chips within the next few years.

Well-connected analyst Ming-Chi Kuo predicts that the first Mac with an A-series chip could be a 13-inch MacBook Pro in late 2020, followed by a MacBook Air in late 2020 or early 2021.

The sale or IPO of Arm Holdings isn't likely to significant impact Apple, though the company could be interested in acquiring the chip design firm. Speculation that Apple could buy Arm Holdings has been circulating for at least a decade.

harrykatsaros · July 13, 2020 9:41PM

Is there any competitive benefit in Apple buying back control of ARM architecture after relinquishing its share some 25 years ago?

edited July 2020

beats · July 13, 2020 9:45PM

harrykatsaros said:

Is there any competitive benefit in Apple buying back control of ARM architecture after relinquishing its share some 25 years ago?

I believe they can make more money from the knockoffs that rip off everything Apple invented.

sflocal · July 13, 2020 9:55PM

I read something not that long ago about ARM being primarily Chinese-owned after some behind-the-scene dealings. Is that not the case? Does a potential sale to someone else besides Apple possibly put at risk the work that Apple has done with their ARM chips?

For example, if Google were to buy ARM, they could immediately shut down all future licensing, including any to Apple right?

mattinoz · July 13, 2020 9:56PM

Is there a cash kickback for mentioning well connected analysts in a good light?
that names seems to be inserted in to every story these days.

elijahg · July 13, 2020 10:04PM

SoftBank only just bought ARM a few years ago. Seems weird to sell them off a few years later.

ua2006 · July 13, 2020 10:09PM

It would be hilarious if Intel bought ARM.

rayz2016 · July 13, 2020 10:22PM

sflocal said:

I read something not that long ago about ARM being primarily Chinese-owned after some behind-the-scene dealings. Is that not the case? Does a potential sale to someone else besides Apple possibly put at risk the work that Apple has done with their ARM chips?

For example, if Google were to buy ARM, they could immediately shut down all future licensing, including any to Apple right?

Apple only licenses the instruction set. I would imagine that the license for that runs pretty much forever. If Google bought ARM and stopped licensing the chip designs it wouldn’t matter: Apple doesn’t use the ARM reference designs anyway.

cia · July 13, 2020 10:32PM

I don't know if Apple could buy ARM out from Softbank without triggering all sorts of monopoly alarm bells. They would control the company that licenses the chip design that essentially every mobile phone manufacturer uses. Would be a massive red flag. I don't think Google could buy it either for the same reason.

edited July 2020

gatorguy · July 13, 2020 11:05PM

sflocal said:

I read something not that long ago about ARM being primarily Chinese-owned after some behind-the-scene dealings. Is that not the case? Does a potential sale to someone else besides Apple possibly put at risk the work that Apple has done with their ARM chips?

For example, if Google were to buy ARM, they could immediately shut down all future licensing, including any to Apple right?

Google is not Apple's enemy, and there would be no financial benefit to Google spending billions to buy ARM Holdings and then refuse to license anyway. Whoever buys ARM would do so to recoup most if not all the expenses via licensing fees.

sflocal · July 13, 2020 11:10PM

gatorguy said:

sflocal said:

I read something not that long ago about ARM being primarily Chinese-owned after some behind-the-scene dealings. Is that not the case? Does a potential sale to someone else besides Apple possibly put at risk the work that Apple has done with their ARM chips?

For example, if Google were to buy ARM, they could immediately shut down all future licensing, including any to Apple right?

Google is not Apple's enemy, and there would be no financial benefit to Google spending billions to buy ARM Holdings and then refuse to license anyway. Whoever buys ARM would do so to recoup most if not all the expenses via licensing fees.

I used Google as an example. I can see the Chinese government (example only) of buying ARM. Does Apple licensing the ARM instruction set the same as a "reference design", or does Apple have some kind of perpetual license to license ARM instructions in addition to its own code?

edited July 2020

mattinoz · July 13, 2020 11:39PM

gatorguy said:

sflocal said:

I read something not that long ago about ARM being primarily Chinese-owned after some behind-the-scene dealings. Is that not the case? Does a potential sale to someone else besides Apple possibly put at risk the work that Apple has done with their ARM chips?

For example, if Google were to buy ARM, they could immediately shut down all future licensing, including any to Apple right?

Google is not Apple's enemy, and there would be no financial benefit to Google spending billions to buy ARM Holdings and then refuse to license anyway. Whoever buys ARM would do so to recoup most if not all the expenses via licensing fees.

Remember that Apple already owns the LLVM compiler project that Google has put efforts into that and would be shooting themselves in the foot.

Which makes we wonder if it would be worth buying as a joint venture and gifting it to the LLVM project to drive. As an independent entity.

Rebrand as Swift-isa.

mjtomlin · July 13, 2020 11:47PM

cia said:

I don't know if Apple could buy ARM out from Softbank without triggering all sorts of monopoly alarm bells. They would control the company that licenses the chip design that essentially every mobile phone manufacturer uses. Would be a massive red flag. I don't think Google could buy it either for the same reason.

I doubt it. Apple already has a monopoly over A-series SoCs, arguably the best in mobile, and no one complains about that. /s

chia · July 13, 2020 11:56PM

ua2006 said:

It would be hilarious if Intel bought ARM.

Intel sells XScale business to Marvell for $600m
https://www.theregister.com/2006/06/27/intel_sells_xscale/

The ARM-based XScale line-up grew out of the StrongARM team Intel acquired in 1998 from DEC.

Once burned, twice shy...

gatorguy · July 14, 2020 12:06AM

Microsoft having an interest in ARM Holdings, assuming it goes up for sale, actually makes some sense. They have a long history of successful licensing and today's related story of the PC side having to make the pivot to ARM at some point is what might have led to this "story" about a potential sale with MS perhaps in mind. Testing the water so to speak.

anonymouse · July 14, 2020 1:56AM

elijahg said:

SoftBank only just bought ARM a few years ago. Seems weird to sell them off a few years later.

Well, they may need to cover their WeWork losses.

blastdoor · July 14, 2020 2:50AM

A sale of ARM will attract a lot of regulatory scrutiny. There is basically no way ARM will be sold to Apple, Google, Intel, Microsoft, or countless others with clear incentives to squash competition.

Maybe a consortium of many of those companies might jointly buy it and turn it into a nonprofit standards setting thing.

But I would think IPO would make the most sense.

rayz2016 · July 14, 2020 3:31AM

gatorguy said:

sflocal said:

I read something not that long ago about ARM being primarily Chinese-owned after some behind-the-scene dealings. Is that not the case? Does a potential sale to someone else besides Apple possibly put at risk the work that Apple has done with their ARM chips?

For example, if Google were to buy ARM, they could immediately shut down all future licensing, including any to Apple right?

Google is not Apple's enemy, and there would be no financial benefit to Google spending billions to buy ARM Holdings and then refuse to license anyway. Whoever buys ARM would do so to recoup most if not all the expenses via licensing fees.

Calm your trousers. Google was just being used as an example. And to be honest, I’d rather Google bought the company over some patent-trolling entity.

edited July 2020

spamsandwich · July 14, 2020 4:11AM

elijahg said:

SoftBank only just bought ARM a few years ago. Seems weird to sell them off a few years later.

Must be costing them an ARM and a leg.

ajmas · July 14, 2020 9:52PM

Apple buying ARM would likely be toxic. The notion being that Apple fully controlling ARM would likely drive many ARM customers away.

I am not sure Apple buying ARM would be beneficial to anyone. ARM does a good job of doing research and everyone else creates the implementation that suits their needs.

On the other hand if the shareholders were a healthy mix of companies that use ARM, then that may be of more interest?

edited July 2020

beats · July 14, 2020 10:34PM

cia said:

I don't know if Apple could buy ARM out from Softbank without triggering all sorts of monopoly alarm bells. They would control the company that licenses the chip design that essentially every mobile phone manufacturer uses. Would be a massive red flag. I don't think Google could buy it either for the same reason.

Every mobile phone copies Apple's iPhone design. So what?

gatorguy said:

sflocal said:

I read something not that long ago about ARM being primarily Chinese-owned after some behind-the-scene dealings. Is that not the case? Does a potential sale to someone else besides Apple possibly put at risk the work that Apple has done with their ARM chips?

For example, if Google were to buy ARM, they could immediately shut down all future licensing, including any to Apple right?

Google is not Apple's enemy, and there would be no financial benefit to Google spending billions to buy ARM Holdings and then refuse to license anyway. Whoever buys ARM would do so to recoup most if not all the expenses via licensing fees.

Tell Google to axe their knockoff OS that they stole from Apple, causing Apple to lose billions if not a trillion in revenue. "Not their enemy".

SoftBank considering sale or IPO of chip design company Arm Holdings

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