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ARM

Company

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ARM Holdings is the British company developing microprocessors. In 2016 it was purchased by the Japanese SoftBank for $32 billion.

Owners:
Softbank
Number of employees

Assets

Owners

+ ARM

ARM - one of the world's leading suppliers of semiconductor components.

The business model of ARM company is connected with design and licensing of chips, but not production and sale of physical semiconductor products. The company issues licenses for the intellectual property (IP) for network of partners into which the leading suppliers of semiconductor components in the world enter. These partners use IC ARM practices for creation and production of systems on the basis of construction of microchips, paying ARM licensing fee for the original IC and a royalty for each chip or the made crystal plate.

It is most known as the developer of processors though is also engaged in creation of development tools under the RealView and KEIL brands brands, other systems, platforms and software. For 2013 holds a dominant position in the market of development of chips for mobile devices.

For 2014 among clients of ARM more than four tens large producers of electronics are registered. Processors on the basis of designs of ARM can be detected in the most different devices — from hard drives to cars and from game consoles to photo and video cameras and TVs.

Offices

The central office is in Cambridge, Great Britain. For the beginning of 2012 staff of the serving more than 1700 people. Offices ARM are located worldwide, including the centers of design in France, India, Sweden and the USA.

ARM headquarters in Cambridge, 2014

Performance Indicators

At the end of 2009 revenue of the company made 305 million pounds sterling.

For the beginning of 2012 more than 15 billion microchips ARM are delivered. 600 licenses for production of processors are sold to more than 200 companies.

History

2017: Staff increase and shares of IT specialists

In October, 2017 it became known of a 25 percent personnel increase of ARM Holdings a year later after sale to the British company to the Japanese telecommunication giant SoftBank for $32 billion. In addition to a total quantity of employees, the share of IT specialists grows in the semiconductor company that corresponds to promises of the new owner.

As reported in the report provided to SoftBank in Panel on takeovers and mergers of Great Britain  (UK Takeover Panel) in a year from the moment of closing of the transaction on acquisition of ARM (on September 5, 2016) the number of staff of the chipmaker increased more than by 1100 people. In Great Britain the staff of ARM grew since 1749 to 2173 employees, and in other countries — since 2651 to 3330.[1]

Absorbing ARM, in SoftBank promised to double in five years number of employees of the semiconductor company in Great Britain and also to expand labor power abroad. However, SoftBank said that a part of a gain will be provided due to transfer to ARM of staff of the Japanese corporation.

ARM increased the staff for 25% and a share of IT specialists after sale to the company for $32 billion

One more condition preserving was of 76.7% or increase in a share of technical specialists in the general state at the level not to allow distribution of low-paid positions. By the beginning of October, 2017 77.9% of personnel of ARM were the share of IT workers.

At last, SoftBank undertook to increase the number of research laboratories ARM in Cambridge from 9 to 11 to strengthen R&D-направление the companies.

The The Financial Times newspaper (FT) notes that all these measures are directed to control of political reaction to merger of ARM which underwent a criticism wave. Negatively even one of founders of ARM  Herman Hauser who called the transaction with SoftBank one of the most "sad and undesirable consequences" of plans of Great Britain for an exit from the EU (Brexit) spoke.[2]

According to the press secretary of the British  prime minister Theresa May, the politician supports the bargain which, according to her, is concluded "in national interests". At the same time earlier Theresa May warned that sale of the British companies to foreign will be considered even more carefully by the authorities.

Obligations of SoftBank within the purchase agreement ARM became the first serious testing of the new legislative rules introduced by UK Takeover Panel. According to them, the buyer of the British assets should open to the regulator detailed data about activity of acquired companies from time to time. In particular, it is necessary to provide the detailed report on whether the buyer kept promises which he made before the conclusion of the transaction. SoftBank transferred such report of UK Takeover Panel.

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This progress at accomplishment of obligations shows not only the aspiration of SoftBank to make of ARM one of the world's leading technology companies, but also about support of jobs, research and development in Great Britain — said in SoftBank.
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Announced sale of ARM in several weeks after holding a referendum on most of which of the British voted for a country exit from the EU. Critics called SoftBank actions mercantile and directed to earning from decline of pound sterling after the announcement of Brexit.

In 2017 SoftBank transferred 25% of the stocks ARM in the fund of investment into SoftBank Vision Fund technologies created in Great Britain which volume was $91 billion. The British authorities foreknew about these plans of SoftBank, and, most likely, such transaction did not cause concern in them, FT notes.

2016

Entry into the market of processors for supercomputers

On August 22, 2016 ARM Holdings announced processor Scalable Vector Extension (SVE) technology by means of which the British company is going to master the market of supercomputers, having thrown down a challenge to Intel and IBM. Read more here.

SoftBank buys ARM for $32 billion

On Monday, July 18, the Japanese telecommunication corporation SoftBank announced purchase of ARM Holdings for 24.3 billion pounds sterling ($32.2 billion). This biggest acquisition in the history of SoftBank.

The cost of the transaction counting on the stock ARM will be 17 pounds sterling that for 40% of high price of actions as of July 15, 2016. After the statement for sale of the British chipmaker of its quotation jumped by 45% to opening of the London Stock Exchange therefore market capitalization of the company made 7.56 billion pounds sterling.

SoftBank announced the largest acquisition in the history

According to the statement of SoftBank, top management and the headquarters of ARM in Cambridge will remain. Besides, the personnel increase of the company in Great Britain at least twice within five years is planned, the Reuters agency reports.

SoftBank will pay acquisition of ARM with own money savings and borrowing facilities received from the Japanese Mizuho Bank. After closing of the transaction of the stock ARM will be removed from the exchange.

Amir Anvarzadeh, the trader on Asian securities in BGC Partners, believes that purchase of ARM is profitable to SoftBank for two reasons. First, the absorbed company has stable cash flows thanks to a market dominance of mobile processors, and secondly, it shows a high margin (about 95% quarterly, since the end of 2014) due to focus on development of technologies.

Some smartphone manufacturers can not like loss of independence of ARM company which before purchase of SoftBank belonged to generally institutional investors, the analyst of Gartner Roger Sheng says. According to him, the Japanese owner can interfere with expansion of business of ARM in the Chinese market because of political problems between the countries and active policy of Celestial Empire in the field of development of domestic semiconductor production.[3]

2014: Facebook implements ARM in data centers

Specialists with interest monitor growth of popularity of multiprocessor server solutions on the basis of ARM (they, for example, in 2014 are actively implemented in data centers of Facebook) and discuss emergence of 64-bit ARMv8.

2012: Preparation for development of processors for servers

The CEO of ARM company Warren East in the interview at the Consumer Electronics Show exhibition in Las Vegas noted that producers of the server hardware announced the experimental systems with economic ARM processors. However, according to him, till the moment until there is an architecture of the new processor and tools by means of which it is possible to achieve significant success in the market, there can pass some more years. ARM started gaining the market of servers in 2008 and then company management were the conclusion is drawn: the road to success will be of six years.

Products of ARM company are used generally in smartphones and tablets, but producers of servers show the growing interest in use of the processors consuming a small amount of energy. The demand of economic processors is caused by need of reducing costs for construction of the data processing centers (DPC). At the same time Hewlett-Packard conducts research and experimental works with use of ARM processors and Tegra 3 chips from Nvidia, integrating their opportunities for construction of the supercomputer in Barcelona.

However, being a beginner in this market, ARM should "move" Intel and Advanced Micro Devices whose processors h86 dominate in data processing centers. Now ARM makes only 32-bit microchips which unlike 64-bit processors for x86 platform, according to Ist's recognition, are in absolutely disadvantage in relation to servers. "There is a number of server applications where the software is written from premises of existence in the system of the 64-bit processor. ARM is first of all today 32-bit processors therefore we should accept the fact that we cannot implement server loadings where the 64-bit chip is supposed", - told Ist.

In October, 2011 ARM provided the first 64-bit microprocessor architecture to ARMv8. Emergence of prototypes of the consumer systems on this chip, as well as the equipment for the enterprises, is not expected approximately till 2014. ARMv8 will be addressed to large volumes of memory and storage systems that is very important for the applications performed on servers. "Everything will be. If 10 years ago we said that we are going to enter the market of servers in 2012, then, so far as we began to create a 64-bit system a little earlier, we will leave there in the nearest future. You should not worry, it seems to me, it is the normal diagram", - emphasized Ist.

While ARM aims to catch a market share of server processors, Intel, entering fight against ARM in the markets smartphones and tablets, began release of own economic chips. At an exhibition CES Intel stated that its processor Atom code-named will be used by Medfield in new smartphones from the companies Lenovo and Motorola.

2007: Start of the Apple iPhone on ARM processors

However the biggest glory of ARM was brought by development of mobile devices. Newton Apple and Pocket PC handhelds were only the preface to what happened after release of iPhone in 2007 and iPad — in the 2010th. The power consumption of architecture of RISC was a key to the structure of portable devices, and how many Intel tries to compete with ARM in this field, it was not succeeded to make the competitive processor for tablets and smartphones on the basis of x86 meanwhile.

1998: Share placing at the exchange, Apple sells the share in the company

Growth and improvement of architecture of ARM did not stop, and in 1998 the company successfully went public. Then, by the way, Apple sold the part of shares: for it it was year of a serious crisis, and failure from a share in ARM helped to be selected from it. Whether then Steve Jobs could assume how important for Apple will be products of ARM in ten years?

Even in Intel at one time released processors on the basis of ARM (a series was called XScale, but in 2006 it was sold together with division).

1992: The processor for the Newton Apple handheld

ARM6 developed especially for the Newton handheld and in cooperation with Apple became the first processor which design was released in ARM Holdings after detaching from Acorn. For the first time ARM6 specification was issued in 1992, and in the 1993rd the company announced the first profits.

1990: Foundation of ARM company

But the fact that Olivetti refused the idea to develop own computer platform did not mean death for ARM at all. The founder of Acorn Computers company Hauzer found a method to select from Olivetti processor business in separate company and found two partners interested in it. In the 1990th year the consolidated enterprise was called as well as architecture of the processor — ARM, but interpretation was replaced with Acorn RISC Machines with Advanced RISC Machines.

For whom at that moment could partnership with the developer of RISC processors be necessary? Obviously, the firm releasing devices on their basis. Apple became it: there in 1990 just designed future Newton handheld, and the ARM processor perfectly suited for it thanks to the profitability in relation to battery power.

As the third partner VLSI Technologies company was selected. This is the direct successor of VLSI Project who was engaged in design and production of integrated microcircuits. The fact that[4] could provide to VLSI own automated design engineering system was important for future joint venture].

VLSI needed the new customer of processors. It in pure form the embodiment of the idea of Conway and the MFA when the developer and GSI producer work separately (and in this case even are on different sides of the Atlantic Ocean). Acorn taught by failure, Hauzer introduced one more amendment: instead of releasing a product, it suggested to be engaged only in design of processors and to sell intellectual property — i.e. designs of chips and the license for their production.

If Intel is well-known that it has tens of the plants worldwide, then ARM by 2014 have no. It did not prevent ARM not only to rise in one row with Intel and AMD, but also to turn slowly into serious threat for them.

Rapid growth of sales of clones of IBM PC in the 1990s affected popularity of RISC not in the best way. Where began to fill Intel and Microsoft, the alternative to x86 family processors actually was not. But there were professional applications: servers and workstations of IBM and Sun Microsystems where "risk" architecture of PowerPC and SPARC respectively and also the market of microcontrollers which was long serving for ARM as the main income item are used.

1978-1984: Acorn era

The history ARM began with creation of Acorn Computers company which in the 1980th years had every chance to take the Intel company place in the world market of processors.

In the 1984th year Acorn fell a victim of crisis in the market of personal computers and the Italian Olivetti purchased 80% in the company. The transaction was unsuccessful as IBM compatible computers began to rule the world and everything that was not joined to them was doomed to oblivion.

See Also

Notes