ARM shares soar on Apple buyout rumor

“Shares of ARM Holdings rose sharply Thursday on renewed speculation that Apple would bid for the mobile phone chip designer, according to a news report,” David Goldman reports for CNNMoney. “ARM’s (ARMH) stock rose more than 9% Thursday in early trading on the Nasdaq. Overseas, the stock rose 7%, but soared as much as 30.7% on the London Stock Exchange before losing much of those gains. A Reuters report said traders were buying up the stock on market rumors of possible takeover interest from Apple.”

Goldman reports, “ARM has long been rumored to be a takeover target for Apple after ARM-designed chips landed in the iPhone and iPad. The so-called ‘A4’ chips are manufactured by Apple, but ARM helped to draw up the blueprint for the processor and collects a licensing fee for each mobile device that Apple sells.”

Goldman reports, “Given Apple’s reliance on ARM’s technology, many analysts and investors have speculated that an outright purchase of the company would make sense for Apple to ward off the risk of ARM going to a competitor. But since almost all of Apple’s competitors are reliant on ARM as well — including deep-pocketed Google — a bidding war would likely ensue should Apple make an offer.”

Full article here.

MacDailyNews Note: Google isn’t as deep-pocketed as Apple.

23 Comments

  1. @MDN,

    Yeah Google doesn’t have as much cash on their balace sheet, but they have huge credibility in the capial markets and could make this an expensive adventure for Apple.

    Otherwise, ain’t gonna happen.

  2. Huge mismatch with Google’s core business. Their foray into hardware is so slight, that buying a chip design firm would be dumb.

    Makes perfect strategic sense for Apple.

  3. shouldn’t apple make a high offer only to let google buy it for even more (admob scenario) only to abandon arm based designs in future ipod/iphone/ipad chips shortly therafter? forcing google to overpay for the next company would be smart in my book. we’re at war, folks ” width=”19″ height=”19″ alt=”wink” style=”border:0;” />

  4. Steven Jobs kept selling off ARM’s shares long after he knew he will be doing a tablet/cell phone/touch PDA, so those rumours are NONSENSICAL.

    ARM terms of licensing allow exclusive innovation for Apple’s own engineers that will have nothing to do with ARM and Apple’s competitors.

    There is no sense for Apple spending money which will bring no competitive advance. Competitors which use ARM will just move on to Intel, Via, et cetera and Apple will have no money from them at all.

    Apple making ARM platform not used by anyone but Apple itself bears no clear competitor advantage.

  5. acquire and extinguish… hmmm, I guess Apple did learn thing or two from M$. This is how you kill the competition. After all, how many phones are using ARM chips? That’s right.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.