Samsung Electronics Co Ltd., a South Korean multinational electronics company, has recently denied reports on the company’s acquisition of a stake in Arm Holdings. Arm Holdings is a semiconductor and software design company, which is wholly owned by Softbank Group.
Sources familiar with the matter have previously reported that the electronics company had been eyeing a purchase of a minority stake of 3 to 5% in Arm Holdings, as a part of its strategy to lower the royalty payment. The company was reportedly set to join the acquisition race and participate in the bid to obtain Arm’s stake in the form of equity investment.
However, Samsung Electronics has revealed that the report on the supposed stake acquisition in the British semiconductor company was groundless.
Established in 1990, Arm Holdings, a chip technology firm, licenses its chip technology and design to various companies including Samsung, Qualcomm Inc., and Apple Inc. These companies deploy Arm’s technology in their chips for use in their smartphones as well as other devices.
Sources have further reported that the multinational conglomerate company, Softbank, is negotiating terms with Nvidia Corporation, a U.S. chipmaker, following the takeover interest revealed by the company in July. Softbank had acquired Arm Holdings for $32 billion in 2016. As per reports, the company has been looking for ways to enter a full or partial sale and a public offering of the chip designer. The reports further added that Samsung expects to lower the licensing fee expenditure by acquiring the equity in Arm Holdings.
As per media reports, Samsung was apparently seeking to acquire equities in Arm Holdings, similar to its previous equity acquisition in ASML in 2012. ASML is the supplier of lithography equipment based on the EUV (extreme ultraviolet) technology. This equipment is a core product used in producing smaller & power-efficient chips.