Business Secretary Peter Kyle has stated he would have blocked the foreign sale of UK tech firm ARM Holdings if he had been in government at the time. The microchip company, once considered a crown jewel of British technology, was acquired by Japan’s Softbank in 2016 and later listed in New York. Kyle expressed regret over this and the earlier acquisition of AI pioneer Deep Mind by Google, highlighting the loss of potential wealth creation for the UK.
Key Takeaways
- Business Secretary Peter Kyle would have vetoed the sale of ARM Holdings to a foreign buyer.
- He believes ARM could have been a trillion-dollar company on the London Stock Exchange.
- Regret was also expressed over Google’s acquisition of Deep Mind.
- The government is introducing new measures to support and retain UK tech companies.
Government’s commitment to UK tech
Kyle made these remarks during London Tech Week, a period marked by the government’s announcement of initiatives aimed at attracting and retaining fast-growing technology companies within the UK. He acknowledged that ARM Holdings, based in Cambridge, was sold to Softbank for £24 billion ($32 billion) a decade ago and is now valued at £285 billion ($380 billion) on the New York Stock Exchange. He suggested that if ARM had remained in the UK, it could have been significantly larger on the London Stock Exchange.
Learning from past mistakes
"We need to learn from these experiences," Kyle stated. He clarified that his approach would not be overly interventionist but rather focused on creating an environment where companies would not want to leave the UK in the first place. To achieve this, the government is prepared to increase investments in promising companies and establish a dedicated cross-government service to assist businesses with skills, finance, and support.
New support measures
Kyle indicated a willingness to "up the risk threshold" to foster innovation, preferring to embrace and shape emerging technologies like AI, even with the possibility of making mistakes, rather than being hindered by caution. Recent government investments have been made in companies such as energy software firm Kraken, self-driving technology company Wayve, and the UK tech-focused investment fund Playground Global.
Challenges in other sectors
Despite the focus on tech, Kyle acknowledged that other sectors, particularly hospitality, are facing significant challenges due to rising costs like the national living wage and employers’ national insurance contributions. He noted the government’s recent decision to phase in business rate rises for pubs more gradually. Kyle also addressed concerns raised by former Health Secretary Alan Milburn regarding a "lost generation" of young workers, stating that the government is actively working to tackle structural challenges in youth employment.
