Sprint shares fell more than 6% overnight after investors realised the deal with Arm would mean no mop up offer from Softbank for a while. Cambridge, England-based ARM designs the underlying architecture for chips, and that architecture is the foundation for billions of chips that are shipped every year by the hardware and chip design partners that use the architecture as the building blocks for mobile hardware, from smartphones to the Internet of Things processors.
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ARM, which was founded in 1990, employs more than 3,000 people.
Meanwhile, Phil Sharpe, director at Grant Thornton’s Cambridge offices, said it was “disappointing” to see ARM acquired by an overseas buyer but said it was a reflection of the current state of the market.
Mr Hauser said ARM gave Britain “real strength”. SoftBank said its offer represents a 43 percent premium to ARM’s closing share price on Friday.
Japanese markets were closed for a national holiday Monday, so trading Tuesday showed the first market reaction in Tokyo to news of SoftBank’s acquisition of ARM ARM, -0.36% ARM, -0.36% was announced Monday.
ARM has been working on automotive projects, which could drive a lucrative new income stream as manufacturers work towards safer, more fuel-efficient and ultimately self-driving vehicles. As an integral part of the transaction, we intend to at least double the number of employees employed by ARM (it employs around 4,000 people) in the United Kingdom over the next five years. In 2013, the company purchased USA telecom Sprint, and has since lost money on the deal.
As part of the deal Softbank has pledged not to change ARM’s successful partnership business model, culture and brand.
SoftBank Group Corp.is a major telecommunications company that is essentially the creation of founder Masayoshi Son, who is chairman and CEO and said to be the second richest man in Japan.
Its brilliance was to realise that if chips were about to come with everything, you didn’t have to make them – designing them was the key.
Earlier this year, Cambridge-based ARM bought the United Kingdom imaging specialist Apical, which specialises in technology to allow computers to analyse images – replicating human vision using software.
Our stand-alone fair value estimate for ARM is £10 per share. However, the Japanese firm seems to be a good parent for smaller companies, and maybe ARM will raise its global profile through this purchase.
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The U.K. company’s shares have increased despite the Brexit referendum less than a month ago, when the U.K. voted to leave the European Union.
