SoftBank Group → Arm Holdings

An all-cash purchase of the UK chip designer at £24.3bn — a 43% premium, agreed three weeks after the Brexit referendum — that took the company behind nearly every smartphone processor private under a Japanese conglomerate.

An all-cash purchase of the UK chip designer at £24.3bn, agreed weeks after the Brexit referendum.

Value

$32B

Announced

July 2016

Completed

September 2016

Sector

Technology

Deal type

acquisition

Acquirer

SoftBank Group (Japan)

Target

Arm Holdings (United Kingdom)

Why it mattered

Arm licensed its designs to the whole industry and earned a royalty on every chip made with them, which in 2016 meant fifteen billion chips a year. SoftBank's Masayoshi Son paid about 50 times earnings on the argument that the same designs would run the "internet of things" — a trillion connected devices — and that owning the company for decades would pay for the price. The timing, weeks after the pound fell on the referendum result, made a British technology champion cheaper in yen and prompted the UK government to extract commitments to double Arm's British headcount.

The deal was Britain's largest technology acquisition and the start of SoftBank's transformation into a technology investor: Arm was later used as collateral, partly sold into the Vision Fund and back, offered to Nvidia in 2020 for $40bn, and listed in 2023 after that sale was blocked.

What it left behind

Arm as a listed company again, majority-owned by SoftBank and valued at several times the 2016 price on the strength of AI data-centre demand the internet-of-things thesis did not predict. It is the case for buying a licensing business with a royalty on the whole industry and holding it through the cycle — and, in the Nvidia episode, the case for how difficult such an asset is to sell.