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SoftBank to buy ARM Holdings for £24.3B

As expected, SoftBank Group Corp. reached an agreement to acquireU.K.-basedsemiconductor firm ARM Holdings Plc for £24.3 billion in cash, according to aJuly 18 news release.

Under the agreement, the Japanese conglomeratewill purchase each ARM share for £17. SoftBank can reduce the offer price by anamount of any dividend declared or paid after the deal's announcement.

SoftBank will fund the acquisition using its existing cashand funds drawn from a term loan facility of up to about £7.3 billion fromMizuho Bank Ltd.

The acquisition will be implemented via a court-sanctionedscheme. ARM's board intends to recommend that the scheme be subject toshareholders' approval at a court meeting and a general meeting following it.The acquisition is not subject to anti-trust or regulatory approvals, but willdepend on conditions set out in the scheme document.

All ARM shareholders as of Sept. 8 will receive an interimdividend of 3.78 pence per share by Oct. 10 or an earlier effective date of thedividend. Further, ARM shareholders as of April 20, 2017, will get a 2016 finaldividend of up to 6.76 pence per ARM share, to be paid May 11, 2017. Theshareholders will receive and retain any future dividends.

Following the deal's completion, ARM will retain itsCambridge headquarters, as well as its operational set-up, management andbrand. SoftBank also intends to increase ARM's workforce within and outside theU.K. over the next five years.

Goldman Sachs International and Lazard & Co. Ltd. servedas ARM's financial advisers on the deal.