According to a Bloomberg report, Nvidia is preparing to abandon its acquisition of British chipArm.
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The well-known American chipmaker has reportedly told associates that the $40 million acquisition deal is unlikely to go through. This appears to be related to regulatory hurdles and industry disagreements in general. There may also be an issue with SoftBank, which now owns Arm. Nvidia had announced plans to acquire Arm since September 2020.
“We continue to hold the views expressed in detail in our latest regulatory filings — namely that this deal provides an opportunity for Arm to grow and enhance competition and innovation,” an Nvidia spokesperson told CNBC via email.
Accordingly, a SoftBank spokesperson said: “We are optimistic that the transaction will be approved.”
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Nvidia's deal to acquire Arm has sparked backlash and led to investigations by regulators around the world, with critics citing concerns about unfair competition.
Arm provides chip designs and related technology to companies like Apple, Samsung and Qualcomm. However, the company's role in the chip industry has always been that of a neutral supplier. With the acquisition, there are fears that Nvidia will cut off competitors from Arm's core technology.
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The US Federal Trade Commission took legal action (last month) to block the deal on antitrust. In addition, British regulators are investigating the deal over concerns it could pose a threat to national security. Nvidia also faces numerous regulatory hurdles in China, where Arm is partnering with Hopu Investments.
More details can be found here.
Source: CNBC
