ARM shareholders approve SoftBank takeover

Shareholders in ARM Holdings have overwhelmingly backed a £24bn takeover by Japan’s SoftBank, despite lingering concerns over the sale of Britain’s biggest technology company.

More than 95% of the microchip designer’s investors voted in favour of the deal at a meeting in London. The company’s board accepted SoftBank’s cash offer on 18 July. The £17 a share offer represents a premium of more than 40% on ARM’s record closing price. The deal is expected to be completed next Monday.

However, Lord Myners, the former City minister, said the takeover was a further example of shareholders selling out for a high price but with little regard for the long-term health of British industry.

“It was a high valuation … but this is one of Britain’s last wholly owned UK-based technology companies. Decisions will no longer be made in the UK and Cambridge. This is evidence of the City’s predilection for selling at a [high] price and getting out.”

To secure the deal, SoftBank made legal commitments to keep ARM’s headquarters in Cambridge and at least double the UK workforce from 1,600 in the next five years. The pledges helped win the approval of the government, which hailed the deal as a post-EU referendum vote of confidence in the UK.

ARM chairman Stuart Chambers said that SoftBank’s guarantees on jobs and investment were legal commitments, not merely “nice ideas and promises and intents”.

“If you look at the post-offer undertakings that SoftBank has made, they are extremely strong, they are virtually unprecedented,” he said after the shareholder meeting.

Chief executive Simon Segars, who will stay with the company, said that SoftBank shared ARM’s long-term view on investment, including retaining and developing the engineers who were essential to ARM’s success. “We are not going anywhere, we are still going to be at the heart of British technology. We are growing globally because we are a global business.”

He added: “This represents an exciting new chapter for ARM, and an ability to really grow and do everything we were doing and do more and do it faster.”

Myners told BBC Radio 4’s Today programme that if ARM – which designs microchips for smartphones including the iPhone – was an American, German, French or Japanese company it would not be allowed to sell itself in 60 days and there would be a review of whether a nationally significant company should be sold.

Myners was a minister in the Labour government during the banking crisis and as chairman of Marks & Spencer helped repel Sir Philip Green’s attempt to buy the company in 2004. His comments echoed the views of Hermann Hauser, who helped launch ARM in 1990.

On the day the deal was announced, Hauser said: “This is a sad day for ARM and a sad day for technology in the UK. There will now be strategic decisions taken in Japan that may or may not help ARM in the UK.”

He urged the British prime minister, Theresa May, to try to stop the takeover if she was serious about reviving the idea of an industrial strategy. SoftBank’s offer has also raised concerns among Japanese investors that the company, which has $113bn (£86bn) of debt, was overstretching itself.

SoftBank has said it is buying Cambridge-based ARM to get ahead in the “internet of things” that connects everyday devices such as fridges to the web.