–the price Softbank is offering for ARM seems very high to me. That’s partly intentional on Softbank’s part, not wanting to get into a bidding war. It’s also based on Softbank’s non-consensus belief that the development of the Internet of Things will be a much bigger plus for ARM than the consensus understands.
–I’m rereading the resignation of Nikesh Arora as a sign of his disapproval of the acquisition, not of Masayoshi Son’s remaining at the helm of Softbank
–ARM seems to be content to be bought. And why not? Holders of ARM stock and options will get a big payday. Softbank has no semiconductor design expertise, so ARM will likely run autonomously under the Son roof. Softbank is also apparently promising to keep the company headquarters in the UK as well as to substantially increase the research staff.
–A competing bid is unlikely. That’s mostly because of the price. But ARM management knows it would never have the operating freedom as a subsidiary of Intel or Samsung (the most logical other suitors) that it would as part of Softbank. When the company’s assets leave in the elevator every night, any unfriendly bid is inherently risky. Doubly so when it threatens a really sweet deal. No, I don’t think antitrust issues would be a deterrent to a bid.
–Will the UK allow the deal? The Financial Times, which should be in a position to know, suggests that the UK might not.
ARM is basically the country’s only major technology company, so domestic ownership may be an issue of national prestige and pride. There’s certain to be some opposition, I think. And crazier things have happened. For example, France disallowed Pepsi’s bid for Danone on the argument that the latter’s yogurt is a national treasure. In the late 1970s, the US barred Fujitsu from buying Fairchild Semiconductor on grounds that foreign ownership presented national security risks …and then allowed it to be sold to French oilfield services firm Schlumberger. More recently, the US scuttled the sale of a ports management business that runs Newark and other US ports to the government of Dubai, an ally, on security grounds. The would-be seller was also foreign, P&O of the UK.
This is the major risk I see.
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