Apple inks new long-term deal with Arm for chip technology

APPLE has signed a new deal with Arm for chip technology that “extends beyond 2040”, according to Arm’s initial public offering (IPO) documents filed on Tuesday (Sep 5).

Arm unveiled pricing on Tuesday for what it hopes will be a US$52 billion IPO which would be the largest such deal in the US this year. Arm owner SoftBank Group plans to offer 95.5 million American depository shares of the United Kingdom-based company for US$47 to US$51 apiece, Arm said in a filing.

Arm owns the intellectual property behind the computing architecture for most of the world’s smartphones, which it licences to Apple and many others. Apple uses Arm’s technology in the processes of designing its own custom chips for its iPhones, iPads and Macs.

The two companies have a long history – Apple was one of the initial companies that partnered it to set up the firm in 1990, before the release of its “Newton” handheld computer in 1993, which used an Arm-based processor chip.

The Newton flopped, but Arm went on to become dominant in mobile phone chips because of its low power consumption, which helps batteries last longer.

Apple was among a number of large technology companies that on Tuesday invested US$735 million in Arm’s IPO. Reuters last week was the first to confirm that Apple was among the strategic investors who agreed to buy shares.

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The deal disclosed on Tuesday was not mentioned in Arm’s previous IPO filing documents made public on Aug 21, implying that the deal was signed between then and Sep 5.

Arm declined to comment beyond its filings, and Apple did not immediately return a request for comment. REUTERS