Arm Ltd., the prestigious UK-based processor designer and owned by Japan’s SoftBank Group Corp., accused CEO of its China division (Arm China) Allen Wu of harming his business there. It all started when the CEO was fired for undisclosed conduct offenses, but the problem arose when Wu refused to resign his position, remaining in control of the business without the consent of the UK headquarters.
As if that were not enough, Wu hired his own security company and does not allow representatives from Arm Ltd. or its board of directors to enter. It has also declined to hold a planned event to connect China-based chipmakers with Arm Ltd. and has avoided negotiations despite public statements to the contrary.
Wu is ” spreading false information and creating a culture of fear and confusion among Arm China employees, ” Arm Ltd. itself said in an official statement.
“Wu’s focus on his own self-preservation has also jeopardized China’s semiconductor innovation by trying to block the critical communication and support that our Chinese partners require from Arm for current and future chip designs.”
China is the largest semiconductor market, and the British company relies on Arm China to do business with local customers, including Huawei Technologies Co. The country accounts for a large proportion of the company’s global revenue, and conflict resolution will be crucial to SoftBank’s plans to sell Arm, a hub of the global smartphone and computing industry that the Japanese company bought for $ 32 billion in 2016.
The complexities of Chinese regulations give Wu an advantage as the holder of key registration documents. As the legal representative of Arm China, Wu is the holder of the company’s registration documents and the company’s seal. Changing the legal representative requires taking possession of the company’s seal, something Wu has refused to give up.