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TSMC to Invest Up to US$100 Million in ARM

Taiwan Semiconductor Manufacturing Co. (TSMC) has decided to invest up to NT$100 million in the U.K.-headquartered ARM Holdings Plc., an IC design subsidiary of Japan’s Softbank Group.

In a statement, TSMC said the investment plan was approved in a board meeting held Tuesday, and that the amount invested will depend on how ARM prices its share in the upcoming public initial offering (IPO).

According to international business news outlets, ARM’s IPO is scheduled for later this week on the U.S. market and is expected to generate almost US$5 billion, with shares set to be priced between US$47 and US$51.

Big tech companies, such as U.S.-based consumer electronics giant Apple Inc. and chip designers Nvidia Corp. and Advanced Micro Devices, Inc. have agreed to invest in ARM’s IPO.

TSMC Chairman Mark Liu (劉德音) in a SEMICON forum held in Taipei on Sept. 6 disclosed that the chipmaker was studying the possibility of investing in ARM.

According to Liu, ARM is a critical part of the global semiconductor ecosystem and TSMC hopes the IC designer, which creates the blueprint or chip architecture upon which 99 percent of the world’s smartphone processors are based, will succeed.

ARM has seen huge demand in its IPO, with Bloomberg reporting orders were already oversubscribed by ten times.

TSMC said the investment in ARM is a strategic decision and is expected to cement the cooperation between the two.

Liu Pei-chen (劉佩真), a researcher at Taiwan Institute of Economic Research (TIER)’s Taiwan Industry Economics Database, said booming artificial intelligence development has boosted demand for edge computing applications, and that ARM’s strength in edge computing technology is expected to support TSMC’s future development in that area.

Liu said ARM has a huge portfolio of semiconductor intellectual property and that TSMC’s acquisition of a stake in the IC designer is expected to strengthen the chipmaker’s ecosystem.

In addition to the ARM deal, TSMC’s board meeting also approved the investment of up to US$432.8 million to acquire a 10 percent stake in IMS Nanofabrication Global, LLC, from Intel Corp.

According to Intel, IMS has commanded the lead in the development of multi-beam mask writing tools required to develop advanced extreme ultraviolet lithography (EUV), which is broadly adopted in leading-edge technology nodes to enable the most demanding computing technologies, such as art AI and mobile applications.

TSMC said that since 2012 the company and Austria-based IMS have worked with each other in developing multi-beam mask writing tool technologies and that the investment is expected to create closer ties with IMS and more innovations through such cross-industry cooperation.

Intel sold a 20 percent stake in IMS to Bain Capital Special Situations, in July. Despite the deals with Bain Capital and TSMC, Intel will still retain the majority ownership of IMS.

“Bain Capital and TSMC’s investments provide IMS with increased independence and reinforce confidence in the significant opportunity ahead of IMS, “Intel said in a statement Tuesday. “This added autonomy will help IMS accelerate its growth and drive the next phase of lithography technology innovation to enable the industry’s transition into new patterning systems, such as high-numerical-aperture (high-NA) EUV.”

Source: Focus Taiwan