Japanese holding company SoftBank has acquired British chipmaker Graphcore, which specializes in the production of chips, including solutions for artificial intelligence. The deal is part of SoftBank’s multi-billion-dollar strategy to strengthen its position in the field of AI.
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Graphcore, founded in 2016 by veterans of the British semiconductor industry, will join SoftBank’s portfolio, which already includes chip designer Arm. The acquisition reflects SoftBank founder Masayoshi Son’s ambition to make the “next big bet” in the tech industry, reports Financial Times.
The deal was not disclosed, but people familiar with the matter said it was worth just over $600 million. It’s worth noting that Graphcore was valued at around $2.5 billion in 2020. However, the company has struggled to commercialize its technology in 2022, reporting sales of just $2.7 million and a pre-tax loss of $205 million.
SoftBank’s backing in this case is a real chance to scale up and reach the next level, as SoftBank plans to provide Graphcore with significant resources. Nigel Toon, Graphcore’s CEO and co-founder, who remains in his position after the deal, said the company’s main problem was a lack of scalability and capital. He hopes that Graphcore will now be able to compete with tech giants like Nvidia and AMD. The deal was completed after receiving all necessary regulatory approvals in the UK and US, as well as national security approval from the British government.
Significantly, before the deal, Graphcore decided to exit its China business after U.S. export controls on AI chips made working with the Middle Kingdom extremely difficult, according to Tung. Graphcore and SoftBank will now focus on customers in America and Europe.
The deal is said to be the latest step in Masayoshi Son’s ambitious plans to usher in the era of artificial intelligence. SoftBank also recently invested more than $1 billion in UK startup Wayve, which is developing self-driving cars.
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