US technology giant Nvidia is understood to have given the UK government firm undertakings about keeping superchip architect Arm in Cambridge after swallowing it for more than $40 billion in the next day or so.
Nvidia, which is acquiring Arm from Japanese parent SoftBank, is said to have agreed the deal and the pricing in a cash plus stock raid.
It has moved to address fears that it was asset stripping Arm’s IP and likely to cripple the company’s Cambridge presence and workforce.
Business Weekly understands that SoftBank was forced to drop plans to strip out Arm’s Internet of Things expertise for two key reasons.
One was to keep Nvidia at the negotiating table and the second to honour a commitment to the UK government when SoftBank clinched the deal.
When SoftBank paid $32bn for Arm in 2016 the Government insisted that it not only maintained Cambridge headcount but also doubled staff numbers locally in five years – by summer or autumn 2021. SoftBank is a long way off hitting that target.
SoftBank and Nvidia agreeing a price and terms for a deal is the easy part of the deal: There is still much water to flow under the transatlantic bridge – and much of it could be turbulent – before Whitehall sanctions an acquisition.
The beleaguered Government cannot risk accusations of a sell-out by letting the UK’s greatest ever technology business and its assets be smuggled secretively away.
Leading entrepreneurs, including Arm co-founder and Cambridge serial investor Hermann Hauser, have urged the Government to veto the raid. Former Labour Party leader Ed Milliband has also called for the most stringent governance of any acquisition.
Arm has consistently declined to comment on the situation and referred all callers to SoftBank, which has endeavoured – without much success – to keep its cards close to its chest.
from Business Weekly https://ift.tt/2ZuSVwY