Samsung terms interest report in Arm Holdings stake as ‘groundless’

Samsung Electronics on Tuesday denied a media report that it is considering buying a small stake in SoftBank Group Corp’s chip company Arm Holdings.

According to reports,  Samsung’s interest in buying a minority stake of between 3% and 5% in the British chip designer as a way to reduce its royalty payment.

According to the company, the report was ‘groundless’.

Arm, the British chip technology firm, licenses its chip designs and technology to companies like Qualcomm, Apple and Samsung, which in turn use that technology in their chips for smartphones and other devices.

SoftBank is currently negotiating terms with U.S. chipmaker Nvidia Corp after receiving an approach about takeover interest last month, reports said.

The Japanese conglomerate, which acquired Arm for $32 billion in 2016, is exploring options including a full or partial sale or a public offering of the British chip designer.

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Earlier, it was reported that Samsung Electronics will halt operations of its last computer factory in China, the latest manufacturer to shift production from the world’s second-biggest economy.

Companies are rethinking their production and supply chains amid rising Chinese labour costs, a U.S.-China trade war and the blow from the COVID-19 pandemic.

According to reports, around half the 1,700 employees on contract at Samsung Electronics Suzhou Computer will be affected, excluding those involved in research and development.

The factory shipped $4.3 billion worth of goods out of China in 2012, a figure that had sunk to $1 billion by 2018, reports said.