back to article Softbank promises stronger ARM: Greater overseas reach and double the UK jobs

Brit-tech success poster child ARM holdings is to be acquired by Japanese telecom multinational Softbank. ARM, whose chip designs drive the majority of the world’s smartphones, is under offer for a remarkable £24.3bn - a premium of 43 per cent over current stock price. Softbank, whose last yearly revenue totalled 19.5 …

  1. James Hughes 1

    Re: Is this the double size already announced or double the double size...

    Overly negative.

    The engineers with the skills (which are NOT easily transferable) are not going to just up and move somewhere else. This is not a company that can simply up sticks and move to a cheaper area, and still succeed.

  2. Anonymous Coward
    Anonymous Coward

    Re: Is this the double size already announced or double the double size...

    > The engineers with the skills (which are NOT easily transferable) are not going to just

    > up and move somewhere else. This is not a company that can simply up sticks and

    > move to a cheaper area, and still succeed.

    All true.

    So it will simply up sticks, and then FAIL.

    Has happened before, will happen again.

  3. Roo
    Windows

    Re: Is this the double size already announced or double the double size...

    "The engineers with the skills (which are NOT easily transferable) are not going to just up and move somewhere else."

    All the chip-design folks I knew at British chip design firms that got bought, either moved abroad or moved to another sector. As charming as Cambridge may be, I don't see any reason to believe ARM will buck that trend. :(

  4. werdsmith Silver badge

    Re: Is this the double size already announced or double the double size...

    ARM are already global and doing their development work all over the world.

  5. Dan 55 Silver badge

    Re: Is this the double size already announced or double the double size...

    Even so, Houser's not pleased.

    ARM is the proudest achievement of my life. The proposed sale to SoftBank is a sad day for me and for technology in Britain.

  6. Vic

    Re: Is this the double size already announced or double the double size...

    The engineers with the skills (which are NOT easily transferable) are not going to just up and move somewhere else.

    Something similar was said about Inmos. Have you seen Aztec West lately?

    Vic.

  7. Random Handle

    Re: Is this the double size already announced or double the double size...

    >The engineers with the skills (which are NOT easily transferable) are not going to just up and move somewhere else.

    Absolutely - ubergeeks given the choice of living through the recession in post-Brexit UK adjacent an imploding EU or getting a funded relocation to Tokyo with A1 healthcare and education for their families are going to think carefully about this for seconds - possibly even minutes.

  8. Yet Another Anonymous coward Silver badge

    Re: Is this the double size already announced or double the double size...

    Japanese companies have a very bad reputation for the pay and conditions of their workers.

  9. Roo
    Windows

    Re: Is this the double size already announced or double the double size...

    "Something similar was said about Inmos. Have you seen Aztec West lately?"

    *Sniff*

  10. John Brown (no body) Silver badge

    Re: Is this the double size already announced or double the double size...

    "Japanese companies have a very bad reputation for the pay and conditions of their workers."

    Especially non-Japanese workers.

  11. smartypants

    Can't see how this has anything to do with Brexit

    ARM is an attractive investment, regardless of where it's based, and regardless of the outcome of the referendum.

    And as for ARM being a 'strategic asset' which the government should 'protect', what does that really mean? The government has a poor track record of such a thing - usually the industries it 'protects' end up being sclerotic and dysfunctional.

    The things we in the UK rely on - power, food, and, yes, electronics - all critical to our survival and supposedly needing of 'strategic protection' mostly come from abroad. For better or worse (I think better), we're living in an interconnected world - very much the world that ARM has flourished in.

    Luckily for us, the politicians aren't very good at spotting and 'protecting' (i.e. suffocating) the next ARM.

  12. Random Handle

    Re: Can't see how this has anything to do with Brexit

    >Can't see how this has anything to do with Brexit

    It doesn't - the Pound crashing made it a lot cheaper, but the Softbank CEO said they were already committed to acquiring it either way....

    >Luckily for us, the politicians aren't very good at spotting and 'protecting' (i.e. suffocating) the next ARM

    UK politicians maybe - pretty sure the German Chancellor could rattle on at length about any technology you care to pick. The next ARM won't be developed in the UK - the company was a throwback to an era of British innovation which is gone forever - even in the 80s it was as anachronistic as it was wonderful.

  13. adam payne Silver badge

    "The Japan giant has committed to “at least” a doubling of ARM’s existing UK workforce, in addition to continued investment in the country, in addition to overseas expansion over the next five years."

    Until they move the whole operation to eastern Europe to cut costs.

    I'm not saying it will happen in this case but we've all seen it before.

    The buyer gives everybody a speech about how fantastic the company it and it fits very well with the direction they want to go. They then say they're going to invest a few lorry loads of cash into all areas of the business. Then a few years down the staff get stabbed in the back.

  14. allthecoolshortnamesweretaken Silver badge

    When something seems to be too good to be true, it usually is.

  15. Steve Todd

    ARM chips in iPads?

    Apple have an ARM architecture licence. They design their own ARM compatible chips. They run the same ARM instruction set as the official designs, but otherwise contain no ARM IP. They aren't the only ones to do this either (Qualcomm and nVidia do likewise).

    That's part of the genius of the ARM strategy, they'll sell you pre-rolled designs for anything from an M0 micro controller through to a fully fledged A73 64 bit application processor, or you can buy off the shelf chips from their partner companies. If you're working in huge volumes though you can design your own from the ground up, save a little on the licensing costs and (possibly) create a more efficient design.

  16. Charlie Clark Silver badge

    Re: ARM chips in iPads?

    They run the same ARM instruction set as the official designs, but otherwise contain no ARM IP.

    They license a bit more than just the instruction set: they get to customise the chips as much as they want.

    save a little on the licensing costs and (possibly) create a more efficient design.

    Having in-house chip engineers is almost certainly going to be more expensive than the licence costs. And even at Apple's volumes, it's cheaper to buy off-the-shelf chips than design your own. It's the ability to do whatever you want in hardware then is attractive. Apple has been able to make sure IOS and the chips work well together.

  17. Steve Todd

    Re: ARM chips in iPads?

    The standard ARM licence lets customers bolt together their standard bits of IP, and combine them with third party designs (you want a PowerVR graphics core rather than a Mali, certainly sir). The architecture licence lets them roll their own cores, with changes to things like the execution units (for higher IPC) or the memory manager (for higher throughput).

  18. Teiwaz Silver badge

    "Luckily for us, the politicians aren't very good at spotting and 'protecting' (i.e. suffocating) the next ARM."

    The politicians don't even grasp how current technology operates, never mind future trends in the industry. The latter is hard enough for well informed techies, otherwise most of us would be lazing about in the bahamas fanning ourselves with wads of share certificates.

  19. Allonymous Coward

    > The politicians don't even grasp how current technology operates

    Sure they do. It's "Digital", right?

  20. John Styles

    Now..

    ... imagine having to explain to Corbyn and McDonnell what ARM do and why they should care about it.

    (or indeed May and Hammond, but the idea of explaining to to Corbyn and McDonnell seems funnier to me).

    As a friend said, if this were an unsuccessful business being sold off, Corbyn, McDonnell and half of Momentum would be picketing outside the business by now.

    (What is the next largest UK 'flag-ship' tech company now, anyway?)

  21. James Hughes 1

    Re: Now..

    Bit harsh, I suspect most politicians would struggle, no need to single out any one or two of them!

  22. MJI Silver badge

    Re: Now..

    Politicians?

    I saw Hammond and May and thought where is Clarkson?

  23. David Roberts Silver badge

    Short term gain?

    Capital Gains Tax windfall?

    Or are the majority of shares already safely offshore?

  24. MJI Silver badge

    Interesting

    I think long term ARM will be safe and stay in the UK.

    Why?

    Because they are being bought by a Japanese company and not an American one. The assets are the workforce and you cannot easily move them. The Japanese do seem to like doing business in the UK.

    What ever happens, hope for the best.

  25. TRT Silver badge

    Re: Interesting

    If they're going to be turning Japanese, I think they're turning Japanese, I really think so, be prepared for potential Vapoursware.

  26. Spiracle

    Re: Interesting

    The assets are the workforce and you cannot easily move them.

    This may, considering the number of non-UK national engineers currently working at ARM, ultimately depend on political decisions taken about the free-movement of labour and just how welcome people feel. I mean, where would you rather spend a wet Tuesday in February - The Fens or Sophia-Antipolis?

  27. Charlie Clark Silver badge

    Re: Interesting

    The assets are the workforce and you cannot easily move them.

    What? You mean like Surrey Satellites? I think you'll find that engineers are often very happy to move.

    No idea if relocation is on the cards for ARM. I think the first thing will be a bonanza for the tax consultants.

  28. Anonymous Coward
    Anonymous Coward

    Re: Interesting

    Speaking as somebody who's just moved from a Japanese company in the UK to an American one, I wouldn't agree with your view that the Japanese necessarily see their workforce as a valuable asset...

  29. technoise
    Linux

    Re: Interesting

    Since ARM mostly thrives from licences and patents, and not from manufacturing, the chief items of interest to any foreign buyer will be the intellectual property. Once they've got that, I would have thought there would be more than enough Japanese engineers who would be able to develop from that. And they will all speak the owners' language.

  30. Tom 7 Silver badge

    Re: Interesting - where to spend a wet Tuesday in February?

    In my experience, and many others I know, the best place to spend a wet Tuesday in February is in the job you love, with the people you love working in, in a stable and confident work environment,

    If you are doing that you love and do well you can wait for 6 weeks holiday in the sun.

  31. Tom 7 Silver badge

    Re: Interesting- more than enough Japanese engineers

    with a lifetimes experience? I think the last micro-chip that fitted in the head of one person was the Z80. I would think it would take and experienced CPU engineer a couple of years to translate their skills to ARM and another 3 or four for them to get a good feeling for how their area of the chip/architecture works with their nearest seven or eight colleagues in such a way they can make optimal improvements/customisations. I've worked with many people in my time who can be parachuted into a job and do a reasonable job in their own corner but very few who could walk the room and line all the desks up in a way that made them all more productive.

  32. Chika

    Re: Interesting

    I mean, where would you rather spend a wet Tuesday in February - The Fens or Sophia-Antipolis?

    Personally, the Fens. Any day.

  33. Steve Evans

    10 per cent of its tablets

    Are you sure about that? 10% seems like an incredibly small number... Especially given iPads are driven by ARM based processors, and almost all Android tablets are too.

    99% would seem like a far more likely number TBH!

  34. Anonymous Coward
    Anonymous Coward

    Cover Girl

    The pic's Nicola Sturgeon on Meldonium (AKA Mildronāts), right? ;)

  35. ganymede io device

    Tsinghua Unigroup of China have increasing shares in UK's Imagination (and other global tech).

    With easy credit no wonder Softbank have bet on the horse with the best form.

  36. User McUser
    WTF?

    Somebody explain this please...

    The offer price is supposedly £17 per share, which currently amounts to ~US$22.55.

    ARMH is currently trading around US$66 which is nearly 3x the officer price.

    So am I an idiot or is everyone else?

  37. ganymede io device

    Re: Somebody explain this please...

    1 ADR in ARMH on NYSE (american depositary receipt?) = 3 ARM.L shares in London.

  38. YARR
    Unhappy

    This is a symptom of something more fundamental : that the governing / management class have no national loyalty and are primarily motivated by short-term profit. Let this be a lesson to anyone who invests their heart and soul into something they don't ultimately own.

    How can we avoid these takeovers from happening? Do we need a British conglomerate that is too large to be taken over? Or should we keep our startups privately funded with our own national crowdfunding?

    The only motive I can think for selling is that we may be at peak ARM as the global sales of most of the devices that contain ARM cores are peaking or post-peak, with the possible exception of ARM-based servers. Nevertheless ARM must have value as an ongoing cash-cow.

    In the long term, I wonder if an open processor core design could potentially displace ARM in the drive to lower costs? Does ARM have anything like the same grip on it's licencees as the Wintel monopoly?

  39. wolfetone Silver badge

    One Word.

    Bullshit.

    It's the typical Tory mentality that the fact a foreign company has bought out a UK business means it benefits the country. How? It benefits those with shares in the company yes, it doesn't benefit the long term prospects for those who work for that company. What then? No job, dole office, then the same Government will turn around and call them lazy and force them to work for the £40 a week while they have some dickhead in the job centre tell them they should give up trying to find a job in technology and focus on securing a job in the retail sector*.

    * personal experience.

  40. werdsmith Silver badge

    Re: One Word.

    Of course it doesn't benefit the country, barely at all. It benefits the shareholders, the bulkhoding of whom will not be in the UK (their bank accounts won't).

    But the government must try and make it sound like a positive. Especially now.

    It's not a tory mentality thing, it's a general one, all the parties are the same.

  41. J.G.Harston Silver badge

    Why are they describing buying something as "investment"? Investment is when you put money into something hopefully to improve it. This is buying something, lock stock and barrel-shifter.

  42. razorfishsl Bronze badge

    The problem is the connection back to China......

    look into this guys past and who he works with.

  43. imaginarynumber

    "Founded in 1990 as a spin-out from an Acorn collaboration with Apple," You omit to mention the 3rd partner, VSLI Technology Inc.

  44. ganymede io device

    ARM has long had Japanese investment

    or the fourth investing partner that joined 1993 Nippon Investment and Finance (of Japan)

    http://www.arm.com/about/company-profile/milestones.php

  45. Anonymous Coward
    Anonymous Coward

    Why... sell?

    I don't get the constant need to sell?

    You have a company that sells a good service or product and thus make a profit, the share holders and employee's get a regular healthy chunk of change everyone should be happy.

    You sell, the share holders get one 'final' chunk of change, the employee's carry on but start wondering when they need sharpen their CV's... to re-apply for their jobs or look elsewhere.

    Why sell something that works!!!! I just don't get it.

  46. Tom 7 Silver badge

    Re: Why... sell?

    Once you float your company on the stock exchange and dont keep a majority share-holding its pretty much compulsory.

    I can also imagine for a lot of the top engineers (who I hope own a shitload of the shares) there comes a point where you get enough money to retire on waved in your face (the shares have gone up 500% or so in 4 years ish) and yo can carry on looking at 128bit chips in 15 years or a few tweaks on the 64 bit ones but you've probably climbed most of the fences and looked over walls and there isn't really a whole lot more to give you a major-league buzz in the same field.

Page:

POST COMMENT House rules

Not a member of The Register? Create a new account here.

  • Enter your comment

  • Add an icon

Anonymous cowards cannot choose their icon

Biting the hand that feeds IT © 1998–2018