Oracle-backed semiconductor startup Ampere Computing weighing a potential sale of business, reported Bloomberg, citing sources.
The company, which specialises in designing chips using Arm’s technology, has engaged a financial adviser recently to manage takeover interest, people familiar with the development told the publication.
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This development indicates that Ampere may be reconsidering its path to an initial public offering (IPO) due to the intensifying competition within the AI-driven semiconductor market.
Ampere Computing’s exploration of a sale comes as the industry sees a surge in investment for AI infrastructure development.
Valued at $8bn in a proposed investment by SoftBank Group in 2021, Ampere is open to discussions with larger industry players about a potential transaction.
While the company’s deliberations are ongoing, and it could remain independent, an IPO is no longer being pursued in the near term, although it has not been completely ruled out for the future, the sources said.
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By GlobalDataAn Ampere Computing representative declined to comment on the news, and Oracle representatives have not yet responded.
The Santa Clara, California-based chip company’s potential sale would mark a shift for the company, especially for founder and CEO Renee James, who previously aimed to take the firm public.
In April 2022, Ampere Computing confidentially filed for a US IPO during a period of high demand for semiconductor technology.
Ampere Computing’s chips are utilised by cloud computing providers such as Microsoft and Google’s Alphabet.
However, the company faces competition not only from other chipmakers but also from the internal development efforts of its potential customers, who are increasingly seeking to reduce dependency on external technologies.
The semiconductor sector is currently adapting to a shift in focus from CPUs to accelerator chips, such as those offered by NVIDIA, which are in high demand for AI applications.
Despite these challenges, James has expressed confidence in Ampere Computing’s technology, particularly its energy efficiency, which is crucial as data centre power budgets increase.
Ampere Computing has also announced more advanced products with more than 500 cores, manufactured using Taiwan Semiconductor Manufacturing‘s latest production technology, which could expand its customer base.
