Happy Thursday!

📝 Focus

• Nvidia, Arm and Grace Hopper

📊 In the Markets

• Disinflation USA

• Microsoft Busts the Trustbuster

📖 MoneyFitt Explains

🎓️ Busted Trustbusters

📝 Focus

Nvidia, Arm and Grace Hopper

Chip designer, Arm, is in talks with trillion dollar chipmaker Nvidia to bring them in as an “anchor investor” for its planned New York listing in September. Nvidia had to abandon its $66bn acquisition of Arm last year due to objections by antitrust🎓 regulators, and now Arm is looking to lock in existing partners to support its IPO. The stake is likely to only be small, in the “low hundreds of millions of dollars”, according to the FT.

..... ▷ Arm is spinning back out of SoftBank, which had taken it private in 2016 at $32bn (£24.3bn), a 43% premium to the company's share price before the announcement, a price that now looks uncharacteristically decent (for SoftBank.) The valuation is still being negotiated, with Nvidia aiming for a lower range of $35-40bn, while Arm and SoftBank want it closer to $80bn. Pricing for the IPO is not yet set but is said to be in the range of $40-80bn, with SoftBank boss Masayoshi Son actively involved.

..... ▷ For Arm, working with Nvidia helps position artificial intelligence (AI) at the centre of its growth plans. Nvidia is looking to expand beyond its core business in graphics processing units (GPUs) into central processing units (CPUs) to handle broader computing functions, further increasing competition for embattled CPU leader Intel. Nvidia recently released Grace Hopper, its first superchip CPU for giant-scale AI and high-performance computing, which used Arm's designs.

..... ▷ Arm is a British semiconductor company that designs microprocessors and other intellectual property (IP). Chips using its IP are used in various devices, including the vast majority of smartphones, tablets, servers and, increasingly, cars. Arm is different from almost all other fabless semiconductor companies in one key way: It does not sell chips. Instead, the company licences its intellectual property to other companies, which then use it to design and manufacture their own chips.