Despite the failed takeover, Nvidia is still looking for as many ARM shares as possible. The company would therefore position itself as a major investor ahead of Arm’s planned IPO.

Nvidia is in talks with Softbank to buy Arm stock ahead of its planned IPO. In early 2022, Nvidia’s acquisition of Arm fell through under pressure from market regulators around the world. There was concern that the acquisition would disadvantage ARM customers competing with Nvidia. After the failed takeover, Softbank, which now fully owns Arm, began planning an IPO.

stability

Softbank is now looking for investors for this IPO. They already have to buy shares in the new company, which should inspire confidence and stability when Arms shares eventually go public. This allows Softbank to sell its shares in Arm as planned and without price surprises.

Nvidia is in talks with Softbank about becoming such an investor. Nvidia itself relies on Arm for CPU designs that support its own GPUs. For example, the Grace CPU in the Grace Hopper superchip is based on Arms Neoverse V2 designs. From Nvidia’s point of view, investing in the company is therefore very logical as it can defend its own interests.

AI hype

Conversely, Nvidia is currently the world’s most valuable chip company, with a market valuation of more than $1 trillion. The company’s success rests on the hype around AI, for which Nvidia makes the main supporting hardware. By linking Nvidia to Arm’s IPO, Softbank hopes to ride the AI ​​hype.

Nothing is final at the moment. The two parties are still debating the original value of the ARM shares and the price Nvidia should pay for them. Nvidia probably wants to buy for several hundred million, of course preferably at the lowest possible price. According to the Financial Times, the negotiations could still fail.