Source: Flipboard

ARM to lay off up to 1,000 employees after collapse of Nvidia Sale
Reports stated ARM's possible job cuts that affect workers in the UK and the US

ARM to lay off employees in the UK and the US
Source: Times News UK

Back in February, SoftBank was in talks to sell ARM Ltd. to Nvidia for a huge deal that was valued at $40 billion, according to Nvidia’s stock price in September 2020. However, the acquisition fell through on February 7, 2022. If we would have seen the deal coming through, it would prove to be the largest acquisition in the chip industry. By estimates, it would have a value of about $60 to $80 billion at the present. After the collapse, ARM had gone for Initial Public Offering (IPO) last month.

The collapse of the acquisition was reportedly because of strong opposition by regulators all around the world. These were major industry players, including Qualcomm and Microsoft which are customers of ARM. They expressed their objection to the deal regarding Nvidia. They cited concerns over Nvidia possibly preventing ARM Ltd. from licensing their chip designs.

On the other hand, companies in the sector opposed to the partnership looking at it as a threat to them. Moreover, the U.S. Federal Trade Commission sued to prevent the deal on grounds of antitrust. Similarly, authorities in the EU and Britain voiced anticipation of a possible inflation. Even the Chinese anti-monopoly regulators had delayed their approval of the cross-border chip partnership. Many anticipated the fall of the acquisition to affect relations between ARM and China and CEO Allen Wu.

ARM Ltd., a British company specialising in semiconductor and software designing was taken over by SoftBank in 2018. SoftBank Group Corp and SoftBank Vision Fund, are the main essence of the Japanese telecommunications company. Most importantly, ARM’s technology is popularly advanced and is used in important smartphone processors like the iPhone’s.

The lay off of employees and other consequences:

Currently, Nvidia is set to pay a break fee of $1.25 billion to SoftBank for the unsuccessful purchase. Alongside, SoftBank would go ahead with its plan of IPO for ARM. Clearly, none of these steps are enough to maintain the firms’ initial state. Hence, finally leading to them cutting off jobs for employees in the UK and the US.

According to a report from Bloomberg, the company is set to lay off around 12 to 15 percent of its staff in both the countries. Apparently, ARM Chief Executive Rene Haas announced the decision to the staff through a memo. It states that the lay off could possibly impact almost 1,000 employees working for ARM in these countries. Mainly, the job cuts are a part of the firm’s effort to reduce on expenditure and take on fewer projects.