Japan's SoftBank buys UK's top tech firm in £24bn deal
Arm Holdings, Britain's most successful technology company, is on course to double its workforce after being snapped up in a £24bn deal by Japan's SoftBank.
SoftBank pledged to embark on a major recruitment drive and hold on to ARM's existing management team following its swoop for the Cambridge-based firm, which supplies technology for Apple's iPhone.
The deal was branded "one of the largest ever from Asia into the UK" by Chancellor Philip Hammond and valued the technology firm at 1700p per share, a 43% premium on Friday's closing share price of 1189p.
The combined group hopes the acquisition will allow it to seize opportunities in the "internet of things" - giving everyday objects a connection to the internet.
Stuart Chambers, chairman of ARM, said: "SoftBank has given assurances that it will invest considerably in the business, including doubling the UK headcount over the next five years and maintaining ARM's unique culture and business model."
However, experts have warned that the deal could lead to a "brain drain" if ARM Holdings' businesses are moved out of the UK.
Analysts also expect more British firms to become foreign takeover targets, with the plunge in the value of the pound making UK firms cheaper following the Brexit vote.
The announcement comes as an early test for Prime Minister Theresa May, who has vowed to defend British companies from foreign buyers.
But Mr Hammond said the tie-up between ARM Holdings and SoftBank would "guarantee to double the number of jobs in ARM and turn this great British company into a global phenomenon".
He added: "Just three weeks after the referendum decision, it shows that Britain has lost none of its allure to international investors. Britain is open for business - and open to foreign investment.
"Softbank's decision confirms that Britain remains one of the most attractive destinations globally for investors."
As part of the deal, ARM Holdings will keep its headquarters in Cambridge while efforts will be made to grow ARM's workforce outside of the UK.
The firm, which employs 3,000 people in the UK, saw its results come in ahead of expectations in April as pre-tax profits lifted 14% to £137.5m in the first quarter year-on-year, while revenues also stepped up 22% to £276.4m.
ARM's directors will recommend the deal is accepted by ARM shareholders.
Masayoshi Son, chairman and chief executive of SoftBank, said the investment marked its strong commitment to the UK and the "competitive advantage" of the science and technology industries in Cambridge.
However, Mark Skilton, a professor of practice at Warwick Business School, warned that it could lead to a loss of skills and knowledge from the UK.
He added: "The concern of brain drain and ARM business moving from the UK must be considered in this equation based on its know-how and leadership in chip design."