Arm’s China subsidiary appears in be in open conflict with headquarters, as it rejected a decision by the British chipmaker to fire China chief Allan Wu.

Details: Arm China, a joint venture set up by Arm Ltd and a Chinese investment consortium in 2018, said in a company statement (in Chinese) Wednesday that Wu remains the chairman and CEO of the company.

  • The announcement came one day after Arm UK said that the board of Arm China voted to remove Wu from his position as CEO and replace him with two co-CEOs, Ken Phua and Phil Tang, according to Bloomberg.
  • “There are no leadership changes happening at Arm China, and Chairman and CEO Allen Wu continues to lead the company,” the statement said.
  • Arm China is an independent legal entity set up in China and the decision was made “upon relevant laws and regulations,” said the company.
  • Arm’s UK headquarters told Bloomberg Wednesday that the company stood by its original statement firing Wu, and added that Wu had been fired “after an investigation uncovered undisclosed conflicts of interest and violations of employee rules.”
  • “Following a whistleblower complaint and several other current and former employee complaints, an investigation was undertaken by Arm Limited… Evidence received from multiple sources found serious irregularities, including failing to disclose conflicts of interest and violations of the employee handbook,” said the British firm.
  • Arm China didn’t reply to an e-mail requesting comment on Arm headquarters’ latest statement.

Context: UK-based Arm, which is owned by Japanese telecom giant Softbank, licenses semiconductor technologies such as the Arm architecture to chip makers. Arm is a key player for Huawei and other Chinese IC companies, as its architecture are standard for mobile phone CPUs, among other applications.

  • Arm China was formed in 2018, when Softbank sold 51% of Arm’s Chinese subsidiary to a consortium consisting of China Investment Corp., the Silk Road Fund and Singaporean state investment firm Temasek Holdings, according to Bloomberg.
  • Arm Ltd directly owns 47.33% of Arm China, according to the Chinese joint venture’s corporate registration information.
  • Phua, one of the co-CEOs appointed by Arm Ltd, is currently vice president of the British firm’s strategic business development department, according to his Linkedin profile.
  • A similar boardroom drama erupted at another British semiconductor IP firm in April, when leaders at UK’s Imagination technologies resigned over what they called “Chinese government” control of the company.

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Writing about semiconductors and telecommunications.