"Feng, there is a British semiconductor company. My team said it is very good. I plan to acquire it."
Semiconductor company? British
"Oh? What company is it, what products does it mainly produce, and how much does it cost?" Feng Yu asked casually.
It was obvious that Brother Ji was hesitating and wanted to ask his opinion. Feng Yu's opinion is generally that he recommends Brother Ji to acquire a company that he has heard of in his previous life. If he has never heard of it in his previous life, then naturally he does not recommend acquiring it unless the price is very low.
"It is a company that designs electronic semiconductor microprocessors. Their company name is Advanced Reduced Instruction Set Processor, or ARM for short."
At first, Feng Yu looked indifferent, but when he heard the abbreviation ARM, he sat up straight.
What, this company? Is this company British
To put it simply, 95% of the cores of tablets and smartphones in previous generations used the ARM architecture, and they also had a dominant position in embedded control, multimedia digital and other aspects.
They have designed a large number of cost-effective and low-energy processors, own the most relevant patented technologies, and even designed a lot of software for this purpose.
This is a company with extremely high technology and potential, but Feng Yu never thought of it.
It’s just that there are no real tablets yet, and the sales of smartphones are far less than that of feature phones. As for embedded control, multimedia digital, etc., there is also competition from other semiconductor companies. But even so, the number of mobile phone cores of their technology is also very large.
But the most interesting thing about this company is that they don’t produce processors at all. They only license technology and make profits from patent fees.
"The equity of this company is very complicated. Many of the world's top semiconductor companies have shares, but their major shareholder is Acorn Computer Company. Its status in the UK is equivalent to that of a fruit company in the United States."
"Fruit companies, VLSI companies, industrial technology companies, Texas Instruments, Qualcomm, etc. all have shares in it, and no one is the controlling party."
"This company is a listed company, listed in London and Nasdaq respectively, with a current market value of about 2.6 billion pounds and an annual profit of less than 200 million pounds. My team contacted Acorn Computer and they agreed to sell it to us , but requires us to pay a 30% premium.”
"The demands of Texas Instruments and other companies were even more extreme. They asked us to pay a 33% premium. Even the fruit company planned to acquire it, but the price offered by the fruit company was almost par, so we were directly rejected."
"Feng, you said the 30% premium is a good deal? The profit is too low, only 200 million pounds a year. But my team told me that I can produce the processor cores myself and sell them for money, like Intel Like Super Power, it will definitely make money.”
Kirilenko saw that when Feng Yu acquired those semiconductor companies, the premiums were high, and in the end they all brought huge profits to Feng Yu.
But when Feng Yu acquired those companies, most of them were unlisted companies. The market value of this listed company is obviously inflated.
Feng himself said that in two years' time, the stock prices of many listed companies will plunge again, and next year will be the peak market value of many companies. Will there be any loss if I buy it at this time
"Brother Ji, my suggestion is to become the major shareholder of this company, but don't expel all other companies, and maintain cooperation to facilitate the company's technology licensing. I can let Chaowei and other companies also acquire some shares, which is enough to ensure that you Have full control of the company.”
This is ARM. Not only are mobile phone processors starting to explode, but also set-top boxes, smart TVs, tablets and other products in the future, ARM is the absolute leader.
Licensing patented technology alone can already guarantee them a lot of profits. Just like Ericsson, it was also the top mobile phone manufacturer at the beginning, but now it is slowly withdrawing from production, isn't it
In the future, Ericsson will specialize in communication technology research and development, and then rely on patent licensing to make considerable profits. It is also more secure and has extremely low risks.
"Feng, why don't you directly become the controlling shareholder?" Kirilenko was a little dissatisfied. Even if he couldn't be a sole proprietor, he should have acquired it and become the controlling shareholder, right
The power of holding more than two-thirds of the shares is completely different from that of holding more than 50% of the shares.
"Brother, you have to know that ARM's business model is completely different from Intel, AMD, etc. It does not produce its own processors, it only does core design and makes money by licensing patents."
"How can we authorize it to more companies? Then it cannot be boycotted by other companies, so ARM needs more allies."
"In this way, your patents can be licensed to more companies and adopted by more companies. The more companies purchase ARM's patent licenses, the higher the profits will be."
"And the operating costs of this company will be very low. I guess the company has less than 2,000 employees now, right? Think about it, how many employees does Interel have?"
"The small number of people also has a big advantage, that is, it has a strong ability to resist risks. Whether it is rising material prices or other risk factors, as long as people still use mobile phones and other electronic products, your patents will not worry about making profits."
"And this kind of profit is still showing an upward trend. The more patents you have, the more profits you can get. It is still a long-term flow, not a one-time deal."
"My investment is to help you have the same say as absolute controlling rights. If you are not satisfied, then these shares can be transferred to you at a fair price in two years."
Kirilenko immediately said: "Feng, what do you mean? Many good projects you have discovered have led me to invest. You want to invest in this company together, how can I object? Since you say this is more reasonable, Then I definitely believe you."
"In this way, I will negotiate with Acorn Computer first, and then we will acquire part of the equity of other companies together. Finally, we can also directly let companies such as Chaowei invest in shares, which will expand our camp."
"Feng, if companies from island countries and other countries want to buy our patented technology, will you sell it?"
"Sell it, why not sell it!" Feng Yu said immediately, "Anyway, we are authorized, not a one-time sale. From now on, they will follow our architectural standards to produce processors and other products. No matter whether they make money or not, we Everyone can make money."
"And in this way, they will slowly rely on our product architecture and lose the ability to conduct independent research and development. In this way, their lifeblood will be in our hands."
"Brother Ji, the market value of this company may double several times in a few years. If you buy it now, you will definitely not lose money!"
… (To be continued.)