ARM Holdings, producer of smartphone microchips and the biggest UK-owned technology company, will almost certainly be bought by Japanese bank SoftBank for £24bn. If plans go ahead, the company will keep its headquarters in Cambridge and double the size of its workforce over the next five years.
The sale has proved to be a bit of a Rorschach test in the shadow of Brexit. A spokesperson for Theresa May has called it a “vote of confidence in Britain”, as it constitutes the largest ever Asian investment in the UK. Chancellor Phillip Hammond said it proves that “Britain has lost none of its allure to international investors” despite its decision to leave the EU. Both politicians were in talks with SoftBank over the weekend.
ARM’s founder, however, was less than delighted. Hermann Hauser said the sale would be a “sad day for me and a sad day for technology in Britain… [ARM] gave Britain real strength”. Hauser is an entrepreneur who was born in Austria but has spent most of his working career in England.
ARM Holdings grew out of Acorn Computing, and designs microchips used in phones and all kinds of “smart devices”. It occupies a market space which will only become more profitable thanks to the growing “Internet of Things”, in which everday devices are loaded with chips so they can be controlled from afar.
Meanwhile, Vince Cable, Liberal Democrat and ex-Secretary of State for Business, Innovation and Skills, told the Financial Times that the sale shows we can’t grow tech giants in the UK, as they are always sold before they reach the scale of Google or Facebook.
The sale also suggests that there will be more, as, thanks to the falling pound, UK companies are now cheaper to overseas investors.
May has spoken out in the past against foreign takeovers of British companies – the Daily Mail‘s Money section heralded her premiership as the end of “City icons falling to foreign vultures“. However, she seems prepared to make an exception here. Is it because the company will keep its UK headquarters and staff? Or does this constitue a U-turn? Only time will tell.
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