Revealed: Huge payoffs for City and bosses in tech giant sale

THE multi-million pound payoffs for bosses and blue-chip firms selling UK tech company arM Holdings to the Japanese were laid bare yesterday.

The UK chip designer is being taken over by SoftBank, which is run by Japan’s second richest man, in a £24billion deal.

It is one of Britain’s biggest technology success stories, with its designs found in 95 per cent of all smartphones.

The firm – based in Cambridge – is also considered to be at the forefront of the ‘internet of things’, whereby devices can communicate with each other.

arM directors are set to pick up as much as £59million from the deal, while Pr firms will pocket £6million.

Some of the blue-chip firms that will benefit were recently shamed for their role in the collapse of BHS.

and the deal could be pushed through in just over a month, it emerged yesterday.

Concerns have also emerged over the track record of arM’s chairman Stuart Chambers.

With him at the helm, landmark British firm Pilkington Glass saw its sites shut and hundreds of jobs lost after it was sold to Japanese buyers.

documents outlining the arM takeover revealed investment bank Goldman Sachs – informal advisers to Sir Philip Green when he sold off BHS – and financial firms Lazard and UBS will pocket £51.2million between them for providing advice.

Meanwhile, SoftBank’s financial advice from companies such as robey Warshaw, The raine Group, and Mizuho will cost up to £276million.

Pr firms Brunswick and Finsbury, founded by remain campaigner roland rudd, will get £6million, while lawyers will receive £14.5million. The GovTurkey, ernment will pocket £120million in stamp duty.

arM bosses will also receive millions for their role.

Chief executive Simon Segars, 48, will be handed £24.5million, while Mr Chambers, 60, who negotiated the sell-off while on a sailing holiday in will get £680,000. Stefan Stern, from the High Pay Centre think-tank, said: ‘advisers love mergers and acquisitions, and from their perspective the bigger the better.’

In an attempt to allay fears that it could strip arM and move its business abroad, the Japanese firm has made a series of legally binding promises – the first under rules drawn up last year.

They include to double arM’s number of UK employees within five years and keep headquarters in Cambridge for at least five years. However, these guarantees have not been tested in court.

Consultancy firm Grant Thornton has been appointed by SoftBank to monitor the obligations, and it could report any breaches to the Takeover Panel. In turn, regulators could enforce the promises in the High Court.

However, judges have never done this before.

and there are question marks over Grant Thornton’s role after the firm acted as advisers in the sale of BHS.

Former Lib dem business secretary Sir vince Cable said: ‘at first sight this is a good detailed set of commitments but it doesn’t deal with the underlying concern over the long term – that tech expertise could gradually leak away from arM and that SoftBank may come under the control of people who lack the commitment of [its owner] Masayoshi Son.

‘The Takeover Panel as far as I know have never enforced an agreement of this kind before and until they do we don’t know how effective they will be.’

Shareholders will vote on the buy-up of arM by august 30, and if approved it will be removed from the London Stock Exchange by September 5 – 33 days from the date offer documents were published.

arM said fees ‘reflect the scale of work required’. SoftBank declined to comment.

‘The bigger the better’