Nvidia 'offering $40 billion+ for chip designer Arm'

US tech firm set to take over chip designer from SoftBank, sources say, in one of two large acquisitions currently in the pipeline; in other M&A news, Gilead Sciences is reportedly close to buying biopharmaceutical company Immunomedics

Nvidia 'offering $40 billion+ for chip designer Arm
The Nvidia booth is seen at the Electronic Entertainment Expo in Los Angeles in June 2017. Photo: Mike Blake/ Reuters.

Californian company Nvidia has made a bid to buy Arm Holdings from SoftBank, the Japanese investment group. The move would ensure that the British chip designer is controlled by American interests at a time of high Sino-US tension over the production and use of semiconductors.

Nvidia is known for its graphics chips that power video games, but it has developed other markets including artificial intelligence, self-driving cars and data centres.

It is reportedly close to a deal to buy Arm Holdings from SoftBank Group Corp for more than $40 billion (£31.26 billion), according to Reuters, which said the acquisition would create a giant in the chip industry.

A cash and stock deal for Arm could be announced as early as next week, the sources two people familiar with the matter told Reuters.

Arm supplies the chip technology for virtually all mobile devices such as phones and tablets but is also expanding into processors for cars, datacenter services and other devices.

The British company does not make chips. Instead it licenses out the underlying technology so others can make chips with it. It has previously collaborated with Nvidia.

Last year Nvidia said it would make its chips work with processors from Arm to build supercomputers, deepening its push into systems that are used for modelling both climate change predictions and nuclear weapons.

SoftBank acquired Arm for $32 billion in 2016, its largest-ever purchase, in part to expand into the internet-of-things technology, which connects everyday devices from traffic signals to refrigerators to the internet.

The terms would mark a big win for the Japanese company which has struggled to jump-start growth in the business, according to the Wall Street Journal, which reported on the deal earlier.

Nvidia declined to comment. SoftBank and Arm also did not respond to Reuters' requests for comments.

'Gilead to buy Immunomedics'

Meanwhile, in a separate acquisition, Gilead Sciences is reportedly close to buying biopharmaceutical company Immunomedics Inc for more than $20 billion in a deal that would further expand Gilead's portfolio of cancer treatments, the Wall Street Journal reported on Saturday.

A deal for Immunomedics, whose cancer therapy Trodelvy is FDA-approved as a third-line treatment for an aggressive type of breast cancer called Metastatic Triple-Negative Breast Cancer, could be announced Monday if not sooner, the Journal said, citing people familiar with the matter.

Talks between Gilead and Immunomedics initially centred around a partnership before shifting to a full-fledged takeover negotiation, the Journal said.

Gilead and Immunomedics did not respond immediately to emailed requests from Reuters for comment.

Shares of Immunomedics, which last month reported positive data from a late-stage confirmatory study for Trodelvy, have nearly doubled this year, giving the company a valuation of close to $10 billion.

An acquisition of Immunomedics would add to several deals Gilead inked this year with the aim of expanding its oncology portfolio.

It bought a 49.9% stake in cancer drug developer Pionyr Immunotherapeutics in June for $275 million, just months after paying $4.9 billion for Forty Seven Inc, maker of an experimental treatment that targets blood cancer.

With reporting by Reuters