Arm China CEO refuses to go despite SoftBank taking control The Arm saga is continuing with the ousted CEO of Arm's renegade Chinese division still refusing to step down, despite being fired again recently. Both SoftBank and Arm were last week seeking an agreement that would allow them to regain control of Arm China, the chip designer's subsidiary in the Middle Kingdom. SoftBank has …
Any Boris success in the elections is largely due to the totally dire alternatives that were offered rather than any particular confidence in him.
The electorate decided that if they are going to have to select from a choice of cretins then they might as well have some comedy out of it.
ARM is the new IBM, more known for it's previous standing in the world and innovations in a long forgotten decade. It's legacy will be an ISA that they don't even implement anymore before long.
It seems all major customers are seeking to move to their own implementations which may help royalities, but that doesn't justify engineering teams with ever growing salaries. Once that happens it will only be a matter of time before those companies jump to something like RISC-V.
So, Softbank bought Arm in 2016 for ~twenty years worth of ARM's yearly revenue and ~64 times their yearly profits, presumably hoping to shove up the licensing fees to make up for this, however when they tried to quadruple the license fees people started looking at switching to other things (eg RISC-V) and Softbank realised that they'd fucked up.
So to improve matters, they sold a majority stake in ARM China to entities controlled by the Chinese Communist Party in 2018.
They are then surprised that the above has rather different objectives to Softbank, and that the China operation is now operating for the benefit of China rather than the ARM board. They then fail to sell ARM to NVIDIA, and are going to sell shares publicly, where they will likely discover a discrepancy between what Softbank wants ARM to be worth vs the actual likely value.
The real tragedy is that these sort of managers are now banned from providing management consulting to Russia so they'll end up advising companies in the UK instead.
Not quite.
To do business in China (as with lots of Asia) the company has to be majority Chinese owned. So typically they are a subsidiary with limited investment, owned by friendlies. This company was a marketing company for ARM in China, basically a few marketing men in an office.
China (the board members connected to the Chinese government) have ejected him. This is not a Chinese takeover of ARM, its a rogue employee.
After he was sacked, all the revenue he hijacked is theft. Any money he's taken from the company is theft.
Likewise any contracts he signed on behalf of the company are voided, the seal works only for China, and those companies sell their products abroad. He is not authorized to sell those licenses.
Presumably he realizes that as soon as he hands over the seal, he faces some major legal problems, and likely jail time.
So I assume he's trying to force a settlement in his favor by furthering this crap. But it won't work. He's done too much damage here I don't think the Chinese board can simply ignore what he's done.
I think at this point, it has to go to court, and they (the Chinese) have to make an example of him.
There's no sense in which a company's manager can seize ownership of the company by stealing the company seal and helping himself to company funds. It's not his company, those are not his funds, and he is in defiance of the Board (which includes a lot of high ranking Chinese officials he's defying).
It's a criminal matter at this point. No longer civil.
This, in itself, is a gigantic red light as to why Western companies should not have commercial dealings with China.
If it is my company, then I should be able to fire whomever I please, but no, not in China. China forces you to have one of their nationals at the head of the company, and if that guy doesn't want to step down, you're screwed.
Well that in itself tells me that I would never want to have a subsidiary in China. You can't trust it.
That has been China's policy since the 1990's when they decided to start taking the West's money in an effort to modernise their economy.
The greedy capitalists of the West fell over themselves in an effort to exploit a new, cheap source of labour and a potential new consumer market.
It is way too late to start complaining, the rules were spelled out quite clearly.
And the fact that this issue has dragged on for years, at a high profile company, shows the whole world how such China subsidiaries can work.
Even if they make an example of that ex boss, it still took so long to get anything done.
In the future, even if I run a company, and am tempted to open something in China, I will have to think twice or thrice. And if forced to (due to shareholders, etc), I will give it very limited resources, access to IP and authority. So any similar screw up, I can dump that operation and tell whoever pushed me into it "told you so".
In the future, even if I run a company, and am tempted to open something in China, I will have to think twice or thrice.
Nah. You start with running it from Singapore, and you only run a subsidiary in China.
That you can't trust certain layers of the bureaucracy there doesn't mean you can't do business there and even get a decent standard of quality. Ask all the hardware producers who have their business there, it's a matter of structure and managing the by now fairly well known risks.
Cut off their access to any of ARM's IP, so while they may have copies of everything up to a certain date it will eventually fall further and further behind the worldwide ARM, and be less and less relevant.
Probably time for Softbank to write off its investment in this subsidiary, without the ability to enforce its will and Chinese courts almost certain to side with ARM China, they don't have much choice.
According to a report published on yesterday, looks like SB/ARM already conceded additional chunk of ARM China to the Chinese investors in exchange for agreeing to ousting of Wu, which translates to virtually zero prospect of the Chinese venture getting included in the expected IPO...
Also, it turns out Wu himself has had a quite legitimate say for awhile, as he himself has built more than a 16 percent stake in the JV.
ARM has been totally wrecked since the delisting/acquisition and meanwhile the UK gov didn't even bother to take a look at "the most successful tech company of the land". Shame, shame.
Source :https://www.scmp.com/tech/big-tech/article/3176645/softbank-wins-key-corporate-battle-china-ousting-defiant-ceo-arm
So it seems ARM's Chinese business is gone and so is at least a quarter of ARM's annual revenue. Adding insult to injury, the Chinese arm is already making a move to become a formidable rival to ARM in the region, by having been actively developing their own IPs, if you consider a lot of Asian electronics manufacturers depend on the Chinese market for their living. The Chinese will def use their homegrown design if it's akin enough to replace the original.
The only solution left to this mess right now is to nationalise ARM to deter further damage to the company, which is crucial to the semi industry of UK and the World. The Gov has to step in and take actions just like it had BP pull back from its Russian business. Enough is enough.
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So basically the Black Hand of the CCP is behind all this.
In any civilized Western nation they'd have simply have called the police to apprehend the CEO for trespassing. Him refusing to go means he's either being guided by the CCP or knows he has the backing of the authorities.
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