UK chipmaker Arm to cut up to 1,000 jobs after $40bn sale collapses
Arm is planning to cut up to 15% of its workforce, the UK computer chipmaker has said, just over a month after the collapse of its $40bn (£30bn) sale to its US rival Nvidia.
The Cambridge-based company said most of the job losses, totalling up to about 1,000 roles, would be in the UK and the US. Arm employs more than 6,500 people worldwide, including 3,000 in the UK.
Arm said: “Like any business, Arm is continually reviewing its business plan to ensure the company has the right balance between opportunities and cost discipline. Unfortunately, this process includes proposed redundancies across Arm’s global workforce.”
In February, SoftBank shelved its blockbuster sale of Arm to Nvidia, citing regulatory hurdles, and said it would instead seek to list the company. SoftBank had acquired Arm in 2016.
The value of the proposed sale, which depended on Nvidia’s stock price, was pegged at about $40bn but rose with Nvidia‘s stock price to about $80bn late last year.
The deal, which would have been the largest in the semiconductor industry, had become mired in red tape on both sides of the Atlantic and in China. It had also faced fierce opposition from players within the industry since it was announced in September 2020.
SoftBank said at the time it would revert to its backup plan of an initial public offering to cash in on Arm, and was to receive a $1.25bn break-up fee from Nvidia.
Nvidia said despite the failed takeover it would remain a close partner because of Arm’s strategic importance in the global chip industry.
The Prospect general secretary, Mike Clancy, said: “Arm is one of the most important providers of high-quality tech jobs in the UK. This latest news will send shockwaves to thousands of Arm employees worried about their jobs.
“We always knew there was a risk
once the sale to Nvidia fell through that the company would seek to restructure or cut costs. We urgently need leadership from government now to protect
British jobs and British research and development spending.”