
Softbank to sell 25% stake in ARM Holdings to Saudi-backed investment group - dan1234
http://www.bbc.co.uk/news/business-39204744
======
awinter-py
The saudis are desperate to use their sovereign wealth fund to diversify (i.e.
save) their economy.

The country has a lot of problems but I'm legitimately excited to see what
they come up with. The first step to getting out of a hole is to recognize
you're in one, and they have.

With any luck, economics-driven policy will lead to social change as well.

~~~
harryh
It's not clear to me how making investments in companies not based in Saudi
Arabia help them diversify their economy. They need to be investing in
building domestic companies not based on oil. This will require investments in
infrastructure, education, health care, etc.

And, as you said, social liberalization as well.

~~~
vidarh
Norway's wealth fund invest primarily abroad as well for the simple reason
that while it is important to diversify the local economy, pouring vast
amounts of money into the local economy drives inflation.

The Saudi's _are_ already pouring money into the local economy as well. But
there's only so fast their economy can make efficient use of that money
without overheating.

Investing abroad is a way of creating a lasting income stream without those
problems.

~~~
awinter-py
This inflation argument sounds right to me.

Can you point to an article which talks more about how SWFs balance their in-
country out-country investment?

~~~
vidarh
I don't have any handy articles, I'm afraid. The Norwegian fund that generally
gets discussed only invests out of country. There is another fund that invests
in Norway (as well as a number of government development banks), but it is
much smaller.

There are more details about both the global and domestic funds here [1],
which does contain some bits on how it splits its investments and has a decent
number of references.

[1]
[https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Nor...](https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Norway)

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grabcocque
I think the headline is misleading at best.

It's transferring 25% of its stake into fund into which it has joint
ownership. The headline makes it sound like its dumping its investment.

The mods changed the BBC's clickbait to something more accurate. Thanks mods!

~~~
mtgx
I, for one, much prefer TheRegister's headline:

> _Softbank tears off chunk of ARM, feeds it to hungry Saudis_

[https://www.theregister.co.uk/2017/03/08/quarter_arm_sold_sa...](https://www.theregister.co.uk/2017/03/08/quarter_arm_sold_saudi_investment_fund_reports/)

~~~
distantsounds
El Reg's headlines are the best. Full of snark and wit.

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petra
So, does the availability of almost infinite oil money(i know, maybe not a
realistic assumption, just an hypothesis) change the chances of ARM overtaking
Intel in servers or PC's ?

~~~
roymurdock
Legacy device markets are pretty firmly entrenched on both sides. Intel with
server/PC MCUs, ARM with any silicon at the SoC/MPU level and below for
smartphones, embedded systems, etc. (also gaining share from migration away
from MIPS and Power architectures). Throwing money at these mkts probably
won't help much, and many are low growth anyways.

The interesting, high-growth spaces where ARM and Intel are currently battling
for hardware mkt share are the IoT Gateways market and the autonomous vehicle
SoC market.

The supporting software ecosystem will also become increasingly important over
the next few years - this is a spot where ARM could really outpace Intel if it
receives a big infusion of resources (see ARM mbed cloud/OS).

~~~
arcanus
High performance computing is also a competitive space. While it has
historically been dominated by x86, next generation architectures, such as ARM
or GPUs are expected to be necessary as the systems grow in size.

------
bargl
Softbank also just started a merger of Intelsat and OneWeb.
[https://techcrunch.com/2017/02/28/oneweb-is-merging-with-
int...](https://techcrunch.com/2017/02/28/oneweb-is-merging-with-intelsat-
softbank-to-invest-another-1-7b-in-new-satellite-co/)

------
darkhorn
Saudis own stakes of Turkish Telekom. And guess what telekom company is worse
in Turkey.

Saudis only milk. No research or development.

------
kbumsik
I was always wondering why Softbank bought ARM. ARM is of course market
leading processor design company but it is almost solely fabless and
intellectual property company. I don't see how ARM would benefit Softbank.

------
technological
Thats nice. For anyone wondering the Saudi-backed investment group is called
"Mubadala".

Mubadala owns 100% of GlobalFoundries ( which brought the hardware division
from IBM)

~~~
axyjo
Mubadala is Emirati, not Saudi. From the article, it seems that just the
Vision Fund run by Mubadala has the backing of the Saudis

~~~
JumpCrisscross
Mubadala is Abu Dhabi's sovereign development company; its "mandate is to
facilitate the diversification of Abu Dhabi’s economy" [1]. The SoftBank
Vision Fund is "managed in the United Kingdom by a subsidiary of" SoftBank
Group Corp [2].

Saudi Arabia's "Public Investment Fund was established in 1971 to provide
financing support for projects of strategic significance to the national
economy" [2]. It is the Saudi analog to Abu Dhabi's Mubadala. PIF is an LP in
the SoftBank Vision Fund, albeit a significant and likely influential one.

[1]
[https://en.m.wikipedia.org/wiki/Mubadala_Development_Company](https://en.m.wikipedia.org/wiki/Mubadala_Development_Company)

[2]
[http://www.softbank.jp/en/corp/news/press/sb/2016/20161014_0...](http://www.softbank.jp/en/corp/news/press/sb/2016/20161014_01/)

~~~
carlsborg
Mubadala also owns a large part of AMD iirc. edit: they sold the stake for
$600M two days ago

~~~
dharma1
AMD stock has had a hell of a run over the last year.. wonder if they
anticipate that that slowing down

