SoftBank Group earlier this year explored a potential deal to acquire U.S. chipmaker Marvell Technology, aiming to merge it with its chip design subsidiary ARM to create a semiconductor giant in the artificial intelligence race.

On November 6th, Bloomberg reported, citing informed sources, that SoftBank had expressed its intention to acquire Marvell several months ago, but the two sides failed to reach a consensus on the terms. Currently, no active negotiations are ongoing b

Following the news, Marvell's stock price rose 13% at one point during the Asian trading session on Blue Ocean, an alternative trading platform. Year-to-date, the company's stock price has fallen by 18% with a market value of around $80 billion. In c

Sun Zhengyi's AI Vision

Driven by the construction boom of artificial intelligence data centers, the AI chip market has enormous potential, providing strong impetus for SoftBank's layout.

According to media reports citing sources with knowledge of the matter, Sun Zhengyi has been continuously studying the feasibility of acquiring Marvell as a potential acquisition target for years.

Even if SoftBank restarts the negotiation, this deal is still facing major obstacles

First, the transaction price could be close to $100 billion, which would be a huge investment.

Secondly, the transaction will face strict regulatory scrutiny. Despite Sun Zhengyi's close relationship with U.S. President Trump, it is still uncertain whether the U.S. government will approve a Japanese company's acquisition of a key U.S. chipmake

Moreover, antitrust review is also a huge challenge. Previously, regulatory agencies in the United States, Europe, and China had forced NVIDIA to abandon its acquisition of ARM in 2020.

Finally, media outlets citing informed sources revealed that ARM and Marvell have not reached a consensus on how to integrate their management teams. ARM's CEO, Rene Haas, is 63 years old, while Marvell's CEO, Matthew Murphy, is in his early 50s.

Marvell's Opportunities and Challenges

Marvell was once highly sought after by the market for its custom chip business prospects, which served clients such as Amazon's cloud department and Microsoft.

Led by CEO Matthew Murphy, Marvell focuses on designing and developing semiconductor chips and related technologies for data centers, and reported a record-breaking revenue of $2 billion in the quarter ended August 2nd.

However, its performance has not been smooth sailing. In March of this year, Marvell's stock price experienced the worst single-day plunge in more than 20 years due to the company's revenue forecast failing to meet expectations.

Meanwhile, its major competitor in the customized AI chip field, Broadcom, has successfully won new clients such as OpenAI. Some analysts have expressed concerns about the predictability of Marvell's future business performance.

In September this year, due to customer uncertainty, TD Cowen lowered its rating on ARM to 'hold'. With a market value of about 80 billion US dollars, ARM has already reached a market value of about 170 billion US dollars.