UK investigating NVIDIA-Arm deal on national security grounds

Posted on Tuesday, April 20 2021 @ 9:34 CEST by Thomas De Maesschalck
It's been over a half year since NVIDIA revealed its plan to take over Arm for a massive $40 billion. The acquisition would give NVIDIA the final piece of the puzzle it needs to offer fully vertically integrated solutions for the datacenter market. But a takeover of Arm is no easy deal. A lot of current Arm licensees object the deal and it's subject to regulatory approval in various countries.

NVIDIA CEO confident about completion of Arm acquisition in 2022

In an interview at last week GTC 2021, NVIDIA CEO Jen-Hsun Huang told VentureBeat he's still confident that the deal will clear in 2022. According to Huang, that's what NVIDIA expected in the first place, that it would take about 18 months for the deal to move through all hurdles.
Huang: ARM and Nvidia are independently and separately excellent businesses, as you know well. We will continue to have excellent separate businesses as we go through this process. However, together we can do many things, and I’ll come back to that. To the beginning of your question, I’m very confident that the regulators will see the wisdom of the transaction. It will provide a surge of innovation. It will create new options for the marketplace. It will allow ARM to be expanded into markets that otherwise are difficult for them to reach themselves. Like many of the partnerships I announced, those are all things bringing AI to the ARM ecosystem, bringing Nvidia’s accelerated computing platform to the ARM ecosystem — it’s something only we and a bunch of computing companies working together can do. The regulators will see the wisdom of it, and our discussions with them are as expected and constructive. I’m confident that we’ll still get the deal done in 2022, which is when we expected it in the first place, about 18 months.

UK invokes national security concerns

The latest roadblock for the NVIDIA-Arm deal involves national security concerns from the UK. Arm is based in Cambridge, UK, and is currently owned by Japanese conglomerate SoftBank. Reuters reports UK digital minister Oliver Dowden issued a so-called intervention notice over the sale of Arm. NVIDIA issued a statement claiming it does not believe the deal poses any material national security risks.
"As a next step and to help me gather the relevant information, the UK's independent competition authority will now prepare a report on the implications of the transaction, which will help inform any further decisions," he said.

Nvidia said it does not believe the deal poses any material national security issues.

"We will continue to work closely with the British authorities, as we have done since the announcement of this deal," said Nvidia, the biggest U.S. chip company by market capitalisation.

About the Author

Thomas De Maesschalck

Thomas has been messing with computer since early childhood and firmly believes the Internet is the best thing since sliced bread. Enjoys playing with new tech, is fascinated by science, and passionate about financial markets. When not behind a computer, he can be found with running shoes on or lifting heavy weights in the weight room.

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