The Japanese company SoftBank and its British developer of processor architectures Arm are close to resolving the issue of regaining control over the Chinese division of Arm China that has left their control. This is reported by Bloomberg .

Image Source: Bloomberg / Kentaro Takahashi

The Board of Directors of Arm China, which includes representatives from SoftBank, Arm’s head office, and Chinese investors, fired the head of the Chinese branch of Allen Wu (Allen Wu) in 2020 due to a “conflict of interest”, but Wu refused to leave his post. He owns the Arm China seal and registration documents, so he simply ignored the decision to fire him and still continues to run this subsidiary.

The Board of Directors of Arm China, with the support of the Chinese authorities, is in the process of transferring control of the company to a new representative. He may be included in the government database as the head of Arm China, as well as provide a new seal of the company in the coming days, Bloomberg writes, citing sources close to this issue. The name of the new head of Arm China has not yet been announced. The resolution on the change of leadership has not been fully developed and some changes may be made to it, the sources of the publication add. They also indicate that SoftBank and Arm have been in talks with Allen Wu since 2020, but have not made significant progress on this issue.

SoftBank declined to comment on the new information, and representatives from Arm and Allen Wu were not available at the time of its publication.

Wu’s obstinacy proved to be a real problem for SoftBank and its founder and CEO, Masayoshi Son. The failed deal to sell Arm to the American company NVIDIA forced the Japanese owner to look for alternative ways to attract investment. Softbank is known to want to list Arm on the New York Stock Exchange next year to raise at least $60 billion per share. The Chinese joint venture Arm China in this situation is an obstacle to the placement of shares of the parent company in the United States.

The Board of Directors of Arm China, until recently, failed to enlist the support of the Chinese authorities in the matter of changing the head. Progress in the discussion began after the proposal to change the ownership structure of the company. Under the new formula, Arm’s head office will retain less than 20% of the shares in the Chinese representative office. The remaining 47.3% of the shares will be transferred to SoftBank. At the same time, if the transaction is successful, Arm will only have obligations under the license agreement with the Chinese division, and not direct control, as over a conventional division.