The UK government announced intentions to intervene on Nvidia’s proposed $40 billion takeover [1] of Arm on national security grounds, with the country’s competition regulator ordered to prepare a report on the implications of the deal.
In a statement, the government noted the issue of a public interest invention notice in relation to the deal, meaning the country’s Secretary of State will make the final decision on whether it goes through.
The UK government ordered a phase one investigation, which will determine whether a full phase two probe will be required, a move heightening chances of the acquisition being blocked.
Nvidia announced plans to acquire Arm, the UK-based chip designer owned by Japanese conglomerate SoftBank Group, in September 2020, as part of a push into the mobile semiconductor sector.
The UK Competition and Markets Authority (CMA) invited third parties [2] to comment on the impact of the proposed deal at the start of this year, ahead of launching an investigation. It said at the time it was concerned the tie-up could lead to Arm raising prices and reducing the quality of services it provides to Nvidia’s competitors.
Along with the UK’s intervention, a host of big-name US technology companies have publicly opposed the deal [3], prompting the Federal Trade Commission to begin a review: the deal also needs clearance from the European Union and China.
Commenting on the UK’s intervention, digital secretary Oliver Dowden said the CMA had been ordered to assess potential ramifications of the takeover.
“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.
[1] https://www.mobileworldlive.com/featured-content/home-banner/nvidia-goes-mobile-with-40b-arm-deal
[2] https://www.mobileworldlive.com/featured-content/top-three/uk-seeks-feedback-on-arm-nvidia-tie-up
[3] https://www.mobileworldlive.com/devices/news-devices/qualcomm-objects-to-nvidia-move-for-arm
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