GPU Manufacturer Nvidia Buys Chip Maker ARM for $40 Billion

California-based Nvidia is buying British computer chip designer Arm Holdings from Softbank Group Corp. in a deal worth $40 billion.

Nvidia, which specializes in making hardware for video game consoles and the crypto mining sector, said in a press release that it would pay Softbank a combination of cash and shares in the transaction. The Japanese conglomerate bought Arm for $32 billion in 2016.

The latest deal is expected to create “the premier computing company for the age of artificial intelligence” (AI), according to Jensen Huang, chief executive officer of Nvidia. He added that Arm would remain headquartered in Cambridge, England and retain its brand.

“We will expand on this great site and build a world-class AI research facility, supporting developments in healthcare, life sciences, robotics, self-driving cars and other fields,” said Huang.

The graphics processing units (GPUs) produced by Nvidia are mainly used in video games but they have also been deployed to mine digital assets such as ethereum (ETH), monero (XMR) and zcash (ZEC). GPUs are now useless for mining bitcoin (BTC), which has moved on to more efficient application-specific integrated circuit (ASIC) miners.

Arm’s technology is the backbone of most of the existing smartphone technology. The company creates designs that other companies such as Apple, Samsung Electronics and Huawei develop into customised chips. Its technology is also starting to gain ground in cloud data centers. To date, Arm says 180 billion chips have been made based on its designs.

Simon Segars, CEO of Arm, detailed: “By bringing together the technical strengths of our two companies we can accelerate our progress and create new solutions that will enable a global ecosystem of innovators.”

Under the terms of the transaction — approved by the boards of Nvidia, Softbank and Arm — Nvidia will pay Softbank $21.5 billion in stock and $12 billion in cash. At least $2 billion is payable at signing. Softbank may also…

Read More