ARM sold for bargain price thanks to Brexit

Vaughn Highfield July 18, 2016

ARM Holdings is to be sold to Japan’s SoftBank for £24.3 billion. The Cambridge-based chip is designer responsible for creating the blueprints for mobile chips found in iPhones and more than 50% of Android phones.

ARM sold for bargain price thanks to Brexit

At first, this seems like quite an undervaluation for ARM – after all, it’s one of Britain’s most successful tech companies. However, The Guardian notes that SoftBank bought ARM at £17 per share – 43% more than ARM’s standard share price on Friday, and 41% higher than ARM’s all-time high.

SoftBank has promised to invest in the UK business, doubling its British workforce and increasing its number of global employees over the next five years. In fact, it makes a lot of sense that SoftBank would go through with the deal now and promise to invest heavily in the company.

The deal has been on the cards since before the EU referendum, but the devaluation of the pound against the Yen has given SoftBank a great opportunity – by our calculations, Brexit saved SoftBank around £3.3 billion. However, it’s likely SoftBank would have gone through with the deal regardless, especially since ARM’s chips are now being used in more and more devices. With the growth of Internet of Things devices, ARM will only grow stronger as more companies make use of its chip designs for their own products.

The deal between SoftBank and ARM also represents one of the largest technology acquisitions in Europe, proving that both Britain and Europe are exciting places for tech businesses.