Chip designer ARM Holdings has come under the market spotlight as rumours do the rounds that it could be an acquisition target for Apple.
The Cambridge-based firm, whose microchips can be found in most of the world's mobile phones, including Apple's iPhone, would likely cost more than £3bn according to reports, such as one on Techradar.com this morning.
Shares in ARM are currently hovering around the unchanged mark at 250.2p but had pushed up to 255.4p earlier today.
Arm Holdings has grown into a multibillion-pound business with 1,700 employees worldwide. Last year almost 4bn chips based on Arm's designs were shipped worldwide. Consumer demand for smartphones means that Arm is getting more and more of its designs into phones. In the last quarter of 2009 the company was averaging 2.4 chips per handset.
As our Communications Editor Richard Wray recently explained, Arm and Apple go way back. Arm is a product of the home-computing boom of the 1980s that pitted Acorn against Sinclair. Having used off-the-shelf processors to power its early models, Acorn decided to create its own microprocessor for a new range of computers with a Californian silicon company called VLSI Technology, and in 1983 the Acorn Risc Machine (Arm) project was born. The chip was a success, but the products Acorn built around it were not. But the chip also met the requirements of Apple and in 1990, Arm was spun off as a separate company with Acorn, Apple and VLSI as founding shareholders.
Part of the reasoning behind the Apple rumours is that as smartphones get smarter, they will need more of Arm's designs. Having said that, Apple now owns its own chip designer – PA Semi.
Apple has declined to comment on the rumour while ARM could not be reached for comment.
