Week 7 will focus on Logistics & Supply Chain Management. Three Faculty members of Tekedia Institute will lead the session.  Ayodele Adenaike, COO of GIG Logistics, examines Supply Chain Systems and Management in a fascinating logistics course.  L.P.S. Barreto, who studied Supply Chain Management in MIT, handles Outlook on Supply Chain Management and how the future could look. Samuel Akinniyi Ajiboyede, CEO of Zido Logistics, provides an entrepreneurial case study. More so, the week comes with a Lab.

Register for the next edition of Tekedia Mini-MBA.

https://www.tekedia.com/mini-mba-3/

Good People, our team has batched the certificates to our members who applied for one in July. Our community is growing! If you have yours, tag me. I like seeing Tekedia Institute’s certificates. As always, contact Admin and you will get yours.

Meanwhile, tomorrow begins a Lab week for the current edition of Tekedia Mini-MBA. Let’s fix business friction in our companies. You will get all elements tomorrow on the Board.

To register for Tekedia Mini-MBA (Aug 10 – Dec 3), visit here.

https://www.tekedia.com/mini-mba-3/

Nvidia is in talks with SoftBank to acquire  British chipmaker ARM. SoftBank, a Japanese mega investor, bought ARM for $32 billion about four years ago. But with SoftBank losing money in Uber, WeWork and  most of its investments, it has to sell assets to recalibrate. If this deal goes through, Intel Corp could be severely wounded – call it a Blackberry inflection point when Blackberry (actually Research in Motion) lost to Apple.

ARM is an English tech company with a great reputation in chip making. It makes chips for modern devices including smartphones, an area where Nvidia is yet to find foothold. But there is a challenge; Bloomberg reported that ARM’s customers, including Apple, Samsung, Qualcomm, Advanced Micro Devices and Intel could demand assurances that a new owner would continue providing equal access to ARM’s instruction set. It was the concern that led to SoftBank buying ARM the last time it went up for sale, because it is a neutral company.

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SoftBank is looking for money to offset its heavy debt by selling off some of its assets, including part of stake in Alibaba, and a part of its holdings in T-Mobile US Inc. a sale of ARM at this point means the Japanese conglomerate will have more money at its coffers to appease distraught investors.

Intel has been disintermediated by TSMC with its legendary manufacturing moat dismantled by the global contract chip manufacturer. The implication is that the castle which Intel has protected for decades is largely vulnerable now. Nvidia does not build big foundries but focuses on R&D designs while its manufacturing partners make the chips. It is a leader in modern chips for datacenters, gaming, AI and more. If ARM goes to Nvidia, it will pick a huge part of the mobile sector, and if that happens, Intel will bleed for years. 

Yes, Intel used to run the most advanced chip factories in the world, and companies depended on it for the most advanced chip designs. But with the advancement of TSMC and Samsung Electronics, companies can practically do the other thing Intel does: chip design. That means, they design and ask TSMC to manufacture. The ability to do that via TSMC without investing in foundries is a new level of disruption for Intel.

Apple had taken its Mac chips from Intel, and would design and fabricate with possibly TSMC or Samsung since other players like GlobalFoundries remain weak. Other companies will do just that. As that happens, the largely closed system of Intel will begin to make way for the ARM business model. Provided there is TSMC to make the chips after circuit designs, most companies will go all the way to designing internally and sending to TMSC to fab.This was not possible in the past as TSMC was weak, but over the last few years, TSMC has evolved to be as good as Intel, if not better.

Intel’s investors are already rattled by Apple big exit, moving its Intel business for Mac processors in-house. This ARMed Nvidia deal could break more investors (see the stock chart below).

Nvidia in Talks with SoftBank to Acquire ARM

Nvidia is reportedly in talks with SoftBank to buy ARM in a deal worth over $32 billion. SoftBank Group Corp. has been exploring ways to sell the British chipmaker that it bought four years ago for $32 billion.

People familiar with the matter said negotiation is in an advanced stage and the parties may reach a deal in the next few weeks, though it is still confidential. Sources said Nvidia is the only company bidding but it is not clear if the deal will be successful.

According to people with the knowledge of the matter, SoftBank may welcome interest from other suitors if it fails to reach an agreement with Nvidia.

ARM is an English tech company with a great reputation in chip making. It makes chips for modern devices including smartphones, an area where Nvidia is yet to find foothold. But there is a challenge; Bloomberg reported that ARM’s customers, including Apple, Samsung, Qualcomm, Advanced Micro Devices and Intel could demand assurances that a new owner would continue providing equal access to ARM’s instruction set. It was the concern that led to SoftBank buying ARM the last time it went up for sale, because it is a neutral company.

However, analysts believe that purchasing ARM would help Nvidia to accelerate innovative ideas.

“With Nvidia’s low-cost fabless model enabling it to focus on R&D, engineering and programming, the fit with Arm would be perfect,” said Neil Campling, an analyst at Miraband Securities.

Analyst at Rosenblatt Securities, Hans Mosesmann noted that Nvidia is the largest maker of graphics processors and it’s spreading the use of the gaming component into new areas such as artificial intelligence processing in data centers and self-driving cars. Matching its own capabilities with central processor units designed by Arm may enable it to take on Intel and Advanced Micro Devices in a more comprehensive way. Mosesmann said the acquisition of Arm may cost Nvidia over $55 billion.

“You need control of BOTH CPU and GPU roadmaps and this, of course, includes data centers. Strategically, Nvidia needs a scalable CPU that can be integrated into its GPU roadmap, as is the case with AMD and Intel,” he said on Friday in reference to central processing units and graphic processing units.

Nvidia has turned a big name in chip making, becoming the world’s largest graphics chipmaker. The California-based company has witnessed more than twenty-fold surge in stock, according to Bloomberg, giving it the opportunity to take on bigger deals. Nvidia’s market value has increased over time to more than $260 billion, making it more valuable than Intel.

Much of its success is attributed to architectural diversity into smart cars, data centers and networking gear. New Street Research LLP said the company could be worth $44 billion if it pursues an initial public offering next year, and estimates its valuation to rise to $68 billion by 2025.

ARM has been enjoying patronage from big tech companies as its designs become top choice for Android and iOS systems. Recently, Apple announced it is dropping Intel as it intends to switch its Mac computers over to ARM-based chipsets.

So if the deal is successful, ARM could go public as early as next year, according to people familiar with matter.

SoftBank is looking for money to offset its heavy debt by selling off some of its assets, including part of stake in Alibaba, and a part of its holdings in T-Mobile US Inc. a sale of ARM at this point means the Japanese conglomerate will have more money at its coffers to appease distraught investors.

But purchasing ARM will trigger heavy scrutiny from regulators because Nvidia is a customer of ARM, and it is a competitor to other companies that get their designs from ARM.