• Competitor rules

    Please remember that any mention of competitors, hinting at competitors or offering to provide details of competitors will result in an account suspension. The full rules can be found under the 'Terms and Rules' link in the bottom right corner of your screen. Just don't mention competitors in any way, shape or form and you'll be OK.

Japan's Softbank to acquired ARM Holdings for £24bn

I doubt it will change ARM's operations significantly. I think license fees will remain similar as well. It will be too risky to try to change that.
 
HACO said:
I doubt it will change ARM's operations significantly. I think license fees will remain similar as well. It will be too risky to try to change that.
Click to expand...

Softbank are a mobile phone carrier so there is some interesting 'opportunities' for them since they'll be licencing ARM IP to the manufacturers of the products they sell. If they decide to lever/squeeze Apple, Samsung etc I wouldn't be surprised if the OEMs jump over to Intel. Softbank has also had to do a corporate split to protect profits in its core Japanese business operations so I don't believe they intend to invest in ARM's future at all (as they claim). I fear in ten years time the main beneficiary of this will be Intel who will have control of both desktop & mobile markets.
 
Good timing. Brexit vote knocked the pound to yen exchange down by about 0.16 so buying in £'s saved them around £2.7bn compared to where it would have been last month assuming price has only just been finalized.

I don't think they'll change much, anyway. ARM is a great business with smart leadership. Worst case scenario would be they try to cut R&D costs and just milk the IP, but it's an IP company in growth - the last thing you would do is try to kill the golden goose at this point in its life. They more likely want opportunities to work closely with ARM and benefit technologically from that close relationship.
 
Had it been a European or US company that bought it, it would be more worrying. Japanese ones tend to invest for more than just quick, short-term cash.
 
Nasher said:
Had it been a European or US company that bought it, it would be more worrying. Japanese ones tend to invest for more than just quick, short-term cash.
Click to expand...

Very true. Japan has a much greater culture of long-term investment than most Western countries. They even still have a concept of staying with one company your hold life which is astonishing by Western standards where the only way most people manage to move up the career ladder is to go to another company.
 
Above all true, but Softbank has $112b in debt & have just had to liquidate $18b in assets. They also bought ARM using a 1 trillion Yen loan so it wasn't like Microsoft or Google's recent failed purchases which used capital held overseas. As a result major credit agencies have advised investors not to put their money in Softbank.

I'm not saying this will not all turn out wonderful for ARM, it might, but I think people should be aware that ARM's future under Softbank may not be rosy at all.
 
Farious said:
Above all true, but Softbank has $112b in debt & have just had to liquidate $18b in assets. They also bought ARM using a 1 trillion Yen loan so it wasn't like Microsoft or Google's recent failed purchases which used capital held overseas. As a result major credit agencies have advised investors not to put their money in Softbank.
Click to expand...

Very interesting. They must have very high expectations of ARM to commit so heavily.

On a separate note, despite the generally positive or neutral coverage in the tech and financial press, I saw the Daily Mail had a headline this morning of "Japanese 24bn raid on UK company" taking up almost the entirety of its front page. Oh you, Daily Mail. :rolleyes:
 
If history is any judge, they will maintain the uk setup for the minimum legal time required then close it down and move it all to Japan, shame the gov didnt step in and examine the deal, it doesn't bode well when a failing financially crippled company buys up one that's at the top of its game.
 
Hmmm but debt in Japan is not the same as debt in the Western World...The Japanese economy and way of thinking is different. That's not a debt, it's a massive investment in an asset which can only appreciate in value. I'm assuming that's how they managed to get the 1Tn Yen loan.
 
smilertoo said:
shame the gov didnt step in and examine the deal
Click to expand...

The government wouldn't have the final say, the EU Commission would who would just wave it through (as they have indicated they would by not objecting to the acquisition in the first place).

UltraSBM said:
Hmmm but debt in Japan is not the same as debt in the Western World...
Click to expand...

The problem with debt is that you eventually have to pay it back. They have in recent months had to dispose of $18b in assets, shove Sprint into a separate company to hide $32b in debt & are currently disposing of Supercell - a company they only bought 3 years ago.

It might all work out good, but based on Softbank's recent financial position I can't help but fear that they are not buying ARM 'for ARM' but just for the IP & should ARM become bothersome, more valuable, or another deal come along, the Cambridge firm will simply be jettisoned.
 
h4rm0ny said:
Very true. Japan has a much greater culture of long-term investment than most Western countries. They even still have a concept of staying with one company your hold life which is astonishing by Western standards where the only way most people manage to move up the career ladder is to go to another company.
Click to expand...

It was like that here once upon a time. But yea, the only way most people get a pay rise now is to go and work for someone else. Companies wonder why there is no employee loyalty any more, why would there be :/
 
Last edited:
Nasher said:
It was like that here once upon a time. But yea, the only way most people get a pay rise now is to go and work for someone else. Companies wonder why there is no employee loyalty any more, why would there be :/
Click to expand...

Ah well, that's a shame. It's a blight on the world of employment that outside companies are the only ones that seem to recognize the value of their employees.
 
h4rm0ny said:
Ah well, that's a shame. It's a blight on the world of employment that outside companies are the only ones that seem to recognize the value of their employees.
Click to expand...

A lot don't seem to realize the value until you start leaving on mass due to sub-par pay and the company folds. Like what happened to my previous place :P
 
You must log in or register to reply here.
Back
Top Bottom