SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B • Hacker News Board

Re: SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B

#91

Post by baybal2 » Sun, Sep 13, 2020, 12:34 AM UTC

hosh wrote: post #90

baybal2 wrote: post #75

Earlier quoted context omitted.

> You're blaming Nvidia. You should be blaming SoftBank and Masayoshi Son: bunch of fucking hucksters misleading people and making bad investments. You shouldn't be blaming bad investors. They pay for their decisions with their, or more often somebody's else, money. Blame the collective ownership of means of production, which in form of public companies have dominated the Western world for the last 30+ years. When pe…

Have you, by chance, looked into any of Carol Sandford’s work?

No

Re: SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B

#92

Post by MangoCoffee » Sun, Sep 13, 2020, 12:57 AM UTC

Animats wrote: post #51

MangoCoffee wrote: post #26

Earlier quoted context omitted.

>ARM is in such a great position currently. There's no reason to sell except that SoftBank is in desperate need of capital. Softbank needs cash. sells ARM. not a good reason?

Softbank has to prop up Uber and WeWork with something. I dunno, would you rather have ARM technology owned by a US company or by a front for the Saudi sovereign wealth fund?

i agree with you but it look like Softbank want money more than ARM. it doesn't matter what you and i think. its whatever Softbank CEO think.

Re: SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B

#93

Post by slipheen » Sun, Sep 13, 2020, 1:03 AM UTC

jonplackett wrote: post #43

What effect does this have on Apple and them basing their own chips on Arm? Are the now so far down their own road of development that it doesn't really matter?

None whatsoever. They have a license from the Newton days which allows them to do whatever they want perpetually.

Re: SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B

#94

Post by ablekh » Sun, Sep 13, 2020, 1:05 AM UTC

Related read (a reminder on the history of the original acquisition): https://www.wired.co.uk/article/softbank-vision-fund.

Re: SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B

#95

Post by valuearb » Sun, Sep 13, 2020, 1:07 AM UTC

Well, looks like I’ve been hugely wrong on this all along. Seems like one of the biggest overpays in acquisition history, I can’t fathom how such a tiny company with such mediocre growth deserves such a massive premium.

Re: SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B

#96

Post by valuearb » Sun, Sep 13, 2020, 1:11 AM UTC

klelatti wrote: post #72

ethbr0 wrote: post #70

Earlier quoted context omitted.

> The $40bn is partly in Nvidia's (arguably) inflated stock. This is SoftBank we're talking about. Do we really want to bring up inflated stock as one of their concerns? ;)

There is bound to be some sort of financial engineering going on too. Doesn't Son have a stake in Nvidia so maybe this is to help support the Nvidia share price?

Giving $40B of Nvidia stock to a cash strapped seller hurts the stock price.

Re: SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B

#97

Post by valuearb » Sun, Sep 13, 2020, 1:13 AM UTC

Retric wrote: post #69

perardi wrote: post #31

Regardless of the consequences of selling to Nvidia…that’s not a great exit, is it? They bought ARM for $32 billion, and they are getting $40 billion for it? With all the money sloshing around in the debt markets, I figured they’d get a bit more.

Depends on how much leverage they used. If it was all cash on hand the that’s a poor ROI, if they only put up say 8b then that‘s a nice return over 4 years.

8B at zero percent interest would only increase the return to about 6% compounded.

Re: SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B

#98

Post by TylerE » Sun, Sep 13, 2020, 1:15 AM UTC

TomVDB wrote: post #83

llsf wrote: post #49

Earlier quoted context omitted.

Softbank bought ARM in 2016 and paid $32B ($35B of 2020 USD after 4 years of inflation). And today they get $40B but partly in Nvidia stocks... Assuming that Softbank manages to sell immediately the Nvidia stock and get their $40B, it is more like 14%. In the same timeframe Nvidia stock went from $30 (Jan. 2016) to $480 (Friday) or x16. Softbank would have a way better outcome if they had invested in Nvidia 4 years a…

Softbank acquired 4.9% of Nvidia for $4B in May 2017. They sold it in February 2019 for $3.6B (according to this https://www.cnbc.com/2019/02/06/softbank-vision-fund-sells-n... ). Another hilarious example of Softbank's market timing expertise. Compared to other investments, an ARM sale of $40B would be a home run...

I wonder what the return would be just taking the opposite position of everything Softbank does is...

Re: SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B

#99

Post by valuearb » Sun, Sep 13, 2020, 1:18 AM UTC

spzb wrote: post #8

I would have thought Apple was a better strategic fit for Arm and likely to be able to pay bigger bucks too.

There is no strategic fit for ARM at Apple. They have a perpetual license already and design their own chips. They don’t need the customer and antitrust headaches to pay over 10x revenues for the ARM licensing business.

Re: SoftBank set to sell UK’s Arm Holdings to Nvidia for $40B

#100

Post by valuearb » Sun, Sep 13, 2020, 1:21 AM UTC

BluSyn wrote: post #3

I think this is a very bad and short-sided deal. ARM is in such a great position currently. There's no reason to sell except that SoftBank is in desperate need of capital. On top of that, Nvidia is likely to be a terrible steward of the IP. Nvidia has a terrible track record of working with other companies, partners, and open source developers. ARM has become a de-facto standard in mobile space, and Nvidia will likel…

Nvidia isn’t likely to invest $40B and then do anything to damage ARMs licensing efforts. They are likely to look to find synergies so ARM can incorporate Nvidia technologies and Nvidia can better utilize ARM technologies.