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Source: Content compiled from Reuters, thank you.
According to Reuters, Arm Holdings, a chip technology provider under SoftBank, is seeking to acquire the UK-based Alphawave. Three insiders revealed that the company is looking to obtain key technology to build its own artificial intelligence processors—specifically, the technology that determines the speed of information transmission on chips, which is crucial for AI, as chatbots like ChatGPT and other applications may require thousands of chips to be linked together to operate smoothly.
This technology is known as “SerDes” (short for Serializer-Deserializer), which is one of Broadcom’s competitive advantages. The company claims this has helped it win AI chip customers such as Alphabet and OpenAI.
One insider told Reuters that the semiconductor intellectual property supplier Alphawave has been working with its investment bankers to explore sale options after receiving acquisition interest from Arm and other potential buyers. However, two insiders stated that after initial discussions with Alphawave, Arm decided not to proceed with the acquisition.
Meanwhile, there are reports that Qualcomm has also shown interest in Alphawave.
SoftBank and Arm declined to comment. Alphawave also declined to comment.
As a result of this news, Alphawave’s stock price rose by 21%, marking its largest increase since September 2021. The stock closed at 93.5 pence on Monday, with a company valuation of approximately £707 million ($914 million).
Alphawave has a joint venture in China called WiseWave, operated in partnership with Chinese investment firm Wise Road Capital. Last year, U.S. officials placed Wise Road Capital on a blacklist for national security reasons. Reuters reported at the time that Arm’s relationship with China complicated its public listing in 2023.
Betting on SERDES
Based in the UK, Arm is 90% owned by Japan’s SoftBank Group. The company does not manufacture chips but sells essential components and other intellectual property. It generates revenue by charging companies licensing fees for using its technology and patent fees for each chip sold.
Arm has been trying to improve its profit margins and increase revenue through a series of strategies. This includes exploring the idea of designing and selling its own chips, indicating that the company may no longer license its intellectual property to other chip design companies but could potentially compete directly with Arm’s customers.
During a civil lawsuit hearing against Qualcomm in December, executives disclosed new guidelines for the company’s future plans. The plans revealed during the hearing included discussions about launching proprietary chips, but CEO Rene Haas downplayed these remarks, stating that these plans reflect long-term strategic discussions that executives frequently engage in.
According to Reuters in February, in addition to the details disclosed during the trial, Arm is also working to find and hire talent capable of launching chips designed by the company.
Arm’s SerDes technology (Serializer/Deserializer, used to convert parallel data to serial data and vice versa for high-speed communication) is not as advanced as the technology built by Alphawave. Although lesser-known, this technology is the foundation of Broadcom and Marvell Technology’s multi-billion dollar custom chip business, which is expected to grow to $60 billion by 2028, according to a recent report by Mark Li at Bernstein.
Nvidia is also developing SerDes technology and has expressed willingness to license it to other companies as part of its custom chip business.
Building robust SerDes technology is crucial for creating an AI chip that stands out. According to industry insiders, constructing SerDes from scratch requires a specific set of expertise and takes about two years.
Reference link
https://www.reuters.com/technology/arm-recently-sought-acquire-alphawave-ai-chip-tech-sources-say-2025-04-01/
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