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Merge Arm with Graphcore, says co-founder

Matthew Field
·2-min read
A photographer taking pictures in front of the logo for British chip designer ARM in Taipei.
A photographer taking pictures in front of the logo for British chip designer ARM in Taipei.

The co-founder of Arm has urged ministers to back a merger between the chip designer and one of Britain’s most promising start-ups instead of allowing a US takeover.

Hermann Hauser, part of the team that established Arm in Cambridge in 1990, writes in The Sunday Telegraph that rather than approve Nvidia’s $40bn (£30bn) acquisition, the Government should engineer a combination with Graphcore, based in Bristol.

Mr Hauser, known as the “godfather” of chip technology in the UK, has been urging the Government to intervene and block the US company Nvidia’s takeover. The deal would see Arm, which designs processors used in billions of smartphones, absorbed by Nvidia, the leading maker of graphics chips. He writes today, however, that state intervention could create a trillion-pound global tech player.

Mr Hauser, whose fund Amadeus Partners is an early investor in Graphcore, a $2bn start-up that designs chips for artificial intelligence, writes: “Graphcore outperforms the best Nvidia chips by a substantial margin.”

He adds that Arm “combined with Graphcore’s AI capabilities... would make Arm the most comprehensive supplier of processors to the world.”

Arm Holdings timeline
Arm Holdings timeline

Mr Hauser said the Government could take a stake in Arm and seek to float it on the London Stock Exchange, bringing in a consortium of investors.

City sources said there had been attempts in recent weeks to “corral investors to come back” and invest in Arm, although such a gatecrashing was viewed as unlikely since SoftBank, which currently owns the firm, would emerge from the deal with billions of dollars in lucrative Nvidia stock.

The Government said last week it would be “scrutinising [the deal] in close detail”, in particular what it means for Arm’s 2,500 UK staff and Cambridge HQ. Jensen Huang, Nvidia’s chief executive, interviewed in this week’s Sunday Telegraph, says he will sign up to legally binding rules to boost recruitment and keep Arm in the UK.

Read more on Nvidia's bid for Arm
Read more on Nvidia's bid for Arm