On Monday, when Masayoshi Son announced his Softbank Group is buying British chip designer ARM holdings, he told the media it was the brightest day in his life and he couldn’t help being excited about the deal.
In 2012, Softbank paid US$20 billion for US mobile carrier Sprint, the biggest overseas acquisition by a Japanese firm at the time.
Son broke his own record with the 24.3 billion pound (US$32 billion) purchase of ARM.
“I had wanted ARM for its outstanding technology 10 years ago but I didn’t have the money. My wish finally came true,” Son said.
He said he had to raise enough funds by selling stakes in Alibaba and Supercell.
The fact that Son was willing to part with these high-potential tech firms shows just how eager he was to get ARM.
Reason: Son believes ARM will be a major player in the internet of things (IoT) era.
ARM, founded 25 years ago, excels in designing powerful, low-cost chips with high energy efficiency.
Its designs have been used in chips for areas such as mobile computing, self-driving vehicles and IoT, according to the China Securities Journal.
About 95 percent of smartphones use ARM technology, including major brands such as iPhone, Samsung and Sony.
Son’s interest in ARM could also stem from his belief in the future of artificial intelligence.
Softbank’s humanoid robot Pepper has been gaining much attention since its launch in 2015.
Powerful chips with next-generation processor architecture will be at the core of artificial intelligence advances.
To popularize the technology, reducing cost and energy consumption is critical.
The ARM price tag is a 43 premium over its market price, or about 70 times earnings, but Son said that 10 years from now, the price will be “extremely cheap”.
Still, investors don’t share Son’s vision and excitement.
Softbank shares plunged 10 percent Tuesday, bouncing back marginally this morning.
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