Japan’s Softbank on Monday offered £24.3bn ($32bn) in cash to acquire 100% of ARM Holdings, the UK’s smartphone chip designer that is one of the leaders in the infrastructure of the internet of things.
In 2015, Forbes ranked ARM as the most innovative company in Europe, and the fifth most innovative in the world.
The deal values ARM at 24.4x 2015 revenues or 56.8x 2015 EBITDA.
We believe this is further proof of the value of UK University spin-outs, and their global appeal – ARM have world-wide sales and are unaffected by Brexit as Philip Hammond, the UK’s Chancellor of the Exchequer, said: “Just three weeks after the referendum decision, it shows that Britain has lost none of its allure to international investors.”
“as ARM’s founders will testify, this is the greatest place in the world to start and grow a technology business,” he added.
Softbank’s investment would be the largest ever from Asia into the UK. The deal would “guarantee to double the number of jobs in ARM in the UK over the next five years and turn this great British company into a global phenomenon”.
Over 70bn ARM-designed chips have been shipped to date, with 95% of the world’s smartphones containing at least one ARM-based component, and Canalys estimate 80% of wearable devices sold in 2014 contained at least one ARM-based chip.
Last month Cambridge CMOS Sensors, another spin-out creating next generation internet of things sensors was acquired by ams AG – more detail can be seen here.
