A JAPANESE technology giant is cutting jobs in Glasgow amid speculation it has been holding talks with a US company that could lead to its UK business, ARM, being taken over.

ARM, owned by the SoftBank conglomerate of Japan, has told staff that 21 roles are at risk at its Internet of Things (IoT) operation in the city, where it currently has 90 staff, The Herald has learned.

The redundancies come as ARM takes steps to separate its two IoT Services Group (ISG) businesses within the group, IoT Platform and Treasure Data, to new entities owned and operated by SoftBank, leaving ARM to “deepen its focus on its core semiconductor IP business”.

Announcing the move in July, ARM said the proposals were “subject to a further board review, customary closing conditions, consultation with local staff representatives (where applicable) and, if approved, is expected to be finalized by the end of September 2020”.

Cambridge-based ARM, which became part of SoftBank in a £24.3 billion deal in 2016, has had a presence in Glasgow since June 2018.

It moved into the city with its acquisition of Stream Technologies, an IoT company set up by one-time accountant and marketer Nigel Chadwick in 2000.

Stream had risen to prominence through its development of an advanced software platform, which enables machine-to-machine communication.

It was credited with building the only platform able to link the entire UK and European eco-system of machine-generated data, which is transmitted by everyday devices such as smart meters, cars and vending machines.

ARM said at the time of the acquisition that Stream would expand its IoT connectivity and device-management capabilities. The former Stream business had steadily expanded its headcount in Glasgow under ARM’s ownership. However, it is now the focus of redundancies as part of the restructuring move to hive off the ISG businesses into separate entities.

A spokeswoman for ARM told The Herald that “there will be two independent businesses, Pelion and Kiegen, under an IoTP (Internet of Things platform) holding company” under the separation plans.

“As part of this proposed transfer, both the Pelion and Kiegen business teams are taking some steps to ensure their resources align with the appropriate level of investment including redundancies for both businesses, pending local laws and consultations,” she said. “In terms of how many jobs are impacted or locations, we are not disclosing that information.”

The restructuring comes amid speculation that SoftBank has been holding talks with US computing giant Nvidia over a deal to sell ARM.

Reports on the deal which saw ARM become part of SoftBank in 2016 stated that the Japanese company had made legal commitments to keep ARM’s headquarters in Cambridge, and to at least double its UK workforce from 1,600 in five years. Reports suggest it had grown the UK headcount to 2,742 by the latter part of 2019.