Nvidia Corp. has shown interest in acquiring Arm Holdings Ltd. from owner SoftBank Group Corp.

Bloomberg reported early talks today between the graphics chipmakers and SoftBank, which acquired Arm for $31.4 billion in 2016 was reported July 13 to be exploring the possibility of selling or publicly listing the company. Although it had been expected that SoftBank would eventually return Arm to public markets, its plans are said to have been accelerated by the ongoing poor performance of some of its investments.

The talks between Nvidia and SoftBank reportedly are only in a preliminary stage and other bidders may emerge for Arm in the coming weeks.

Neither company has commented on the report. Should a deal go ahead, it would be one of the biggest and most significant deals in semiconductor industry history.

The price of a potential deal is at best speculative at this stage, but as Arm has gone from strength to strength since it was acquired in 2016, a high premium on its $32 billion valuation would be expected. A potential deal would also come at a time that there’s a shift toward Arm-based architecture away from traditional Intel Corp. x86 processors. Apple Inc., for instance, is planning to move to Arm chips, and Microsoft Corp.has taken an interest as well.

Although a deal is possible, regulatory approval would be another matter. Arm creates and licenses the basic architecture used in most mobile processors. The chances are if you own a smartphone, you have an Arm-based chip, since they’re found across all leading brands: Apple with its A-series iPhone and iPad processor, Samsung Electronics Co. Ltd. through both Qualcomm Snapdragon processors in the U.S. and its Exynos chips in other countries, and Huawei Electronics Co. Ltd. through its Kirin chips.

With that scope, the deal would be heavily scrutinized. Any company acquiring Arm, be it Nvidia or another bidder, would need to prove that it would provide equal access to the Arm instruction set, a consideration that was key to SoftBank acquiring the company in the first place.

For Nvidia, the acquisition of Arm would provide the company a broader scope of offerings in addition to its current lineup of graphics processing units and other products.

Patrick Moorhead, president and principal analyst at Moor Insights & Strategy, said buying Arm would be a serious data center and personal computer processor play to add to its GPUs and networking chips. “Getting it approved would be challenging but not insurmountable,” he said. Despite the high price involved in a potential deal, Moorhead added that “financially they could absolutely pull it off.”

The report Nvidia was interested in Arm broke mid-afternoon on the East Coast during regular trading, but investors didn’t take much interest at least for now. Nvidia shares rose 1%, to $417.55, as of the close of regular trading, slightly higher than the Nasdaq, which remained fairly flat, rising only 0.24%.

Photo: Kārlis Dambrāns/Flickr